**2. The scientific community's interest in the phenomenon of organizational culture**

Publications of the Web of Science Core Collection (Clarivate Analytics) (hereafter WoS) database were selected for the analysis of scientific research. The search criteria were keywords 'organizational culture' in title, in topic and in search by highly cited in field (**Table 1**). Since the research starting from 1990 can be found in the WoS database, the statistics of publications from 1990 to 2018 was reviewed. The review of the change of the number of publications on the topic in the past 30 years shows the trends of growth of the number of studies indicating the scientific community's interest in this phenomenon.

Thus, from 1990 to the present day in 2018, organizational culture researches (according to the title search) were published in 2084 publications (according to the topic search in 16,382, from which 81 are highly cited in field). All of them show a non-decreasing interest in the Introductory Chapter: Organizational Culture - How Much Underused Potential Does Science Have? http://dx.doi.org/10.5772/intechopen.81134 3


**Table 1.** Statistics of research published in 2008–2018 and 1990–2000.

Drucker [3], observing the processes in the organizations at the end of the last century, accurately identified that creative human intellectual activity will become one of the most important investments of organizations in the new century and results of other studies support it by five key factors of organizational creativity, such as organizational climate, leadership style, organizational culture, resources and skills and structure and systems of an organization [4]. Reviews of newer studies highlight the impact of organizational culture on various knowledge management processes and their links with organizational performance [5, 6], considering the close relationship with the innovativeness of the organizations [7, 8], etc.

On the other hand, the studies do not yet provide unambiguous answers to the questions that arise to both practitioners in the management of organizations and scientists researching the phenomenon of organizational culture. Although some researches support the significance of organizational culture for performance, Scott et al. [9] who studied the researches of a strong culture and efficiency of organizational activities noted the fact that these relationships are not always confirmed; therefore, in order to find out the relationship between organizational culture (cultures) and activity (activities), much greater methodological resourcefulness is necessary. The studies miss unambiguous answers on how to manage cultural diversity in organizations [10]. In addition, Johnson et al. [11] argue that there is no single recipe of organizational culture change suitable for all. According to the authors, attention to context with key features including diagnosis and evaluation of culture, a combination of support from leaders and others in the organization and strategies to embed the culture change is important for the change process to happen. In this context, the analysis of studies conducted by Vom Brocke and Sinnl [12] shows that culture in business process management requires a more comprehensive holistic approach. And these are only some of the aspects of the broad palette of the exploration of the phenomenon of organizational culture, indicating the number of questions that still remain unanswered. It is difficult to find at least one area of organizational activities that would not be influenced by organizational culture, which is demonstrated by the directions of research conducted in recent decades and the abundance of this research.

**2. The scientific community's interest in the phenomenon** 

the scientific community's interest in this phenomenon.

Publications of the Web of Science Core Collection (Clarivate Analytics) (hereafter WoS) database were selected for the analysis of scientific research. The search criteria were keywords 'organizational culture' in title, in topic and in search by highly cited in field (**Table 1**). Since the research starting from 1990 can be found in the WoS database, the statistics of publications from 1990 to 2018 was reviewed. The review of the change of the number of publications on the topic in the past 30 years shows the trends of growth of the number of studies indicating

Thus, from 1990 to the present day in 2018, organizational culture researches (according to the title search) were published in 2084 publications (according to the topic search in 16,382, from which 81 are highly cited in field). All of them show a non-decreasing interest in the

**of organizational culture**

2 Organizational Culture

phenomenon of organizational culture, but it should be noted that the dynamics of the change in highly cited prompts that are far from all research conducted during this period are assessed equally highly in the scientific community. Further, it is worthwhile discussing how the spectrum and topics of research on the organizational culture were changing during these years, disclosing new aspects of this phenomenon.

### **3. Thematic changes in the spectrum of research on organizational culture**

Publications of the year 2018, i.e. 23 publications (group 1), and research papers published in 1990, i.e. 20 publications (group 2), were selected for further analysis. Review of organizational culture studies of 2018 is presented in **Table 2**.

Thus, 23 publications have been registered in the WoS database in 2018 until May; however, not only the formal dates but also the fact that the researches have to go a long way before publishing must be taken into account. In any case, when looking at both the geography of the published researches (the USA, Jordan, India, Brazil, Malaysia, Turkey, the Czech Republic,


**Researches of organizational culture and insights Document** 

Introductory Chapter: Organizational Culture - How Much Underused Potential Does Science Have?

The role of organizational culture, which is characterized by emotional commitment and job satisfaction in public sector organizations, is studied. It was found that bureaucratic culture negatively affects organizational commitment and the impact of affective commitment on employees' job satisfaction is moderated by supportive and innovative

The relationship of organizational culture and performance is investigated. The research conducted by the authors provides supporting empirical evidence for the cultureperformance link by identifying the principle culture value characteristics (strength and unbalance), which exert both direct and interaction effects on the introvert and extrovert

The impact of organizational culture on knowledge management is analyzed by examining the impact of job satisfaction in banking Results of the research show that the weak and unstable organizational culture and knowledge management development may adversely

Authors research how the disciplinary power is manifested and interpreted by teachers in the face of the elements of the organizational culture in private higher education institutions. It was found that the quality of teaching is weaker when the teacher becomes a mere executor of teaching programmes with reduced autonomy and control of their

The authors examine the theory of public value, informal professional networks and organizational culture. Based on structural equation, the obtained results show that informal professional networks are positively associated with higher discretionary power

It is examined how organizational innovation can be accelerated by supporting management structures and organizational climate, taking into account the innovative examples of universities in the world. On the basis of the results of the research, the authors state that universities and research institutes should draft and implement guidelines where leaders with certain traits and norms can play a role to nourish an environment where stakeholders think outside the box, with learning and knowledge creation and proactive contribution beyond responsibilities, obligations and compulsion

Authors research the contribution of interorganizational relations (including suppliers and customers) to the organizational cultural change. It was found that interorganizational culture is developed as a system of symbols and meanings, which is shared by groups of different organizations or persons during the transition period, because cultural

The author draws attention to the fact that religion is a pervasive organizing framework and in terms of communication, its role in the socialization processes has to be understood

The influence of organizational culture and climate on the services provided by healthcare institutions is studied. It is noted that the degree of concordance between administrators and clinicians in their reports of organizational culture and climate may have implications

Organizational culture and climate studies and the role of the national culture are discussed. The organizations seeking to become prospective are recommended to integrate modern climate and cultural way of thinking and scientific research in this area into their

The authors of the research measure organizational culture, divided into three aspects (bureaucratic, supportive and innovative), taking into account the demography of respondents. It was found that gender differences did not have a significant impact on

and a proactive asset maintenance organizational culture

fragmentation perspectives are predominant

for research design, inferences and organizational intervention

evaluation of organizational culture, unlike the age criteria

cultures

activities

and evaluated

practice

aspects of firm performance

affect the development of the sector

**type**

http://dx.doi.org/10.5772/intechopen.81134

Article [24]

Article [25]

Article [26]

Article [27]

Article [28]

Article [29]

Article [30]

Article [31]

Article [32]

Article [33]

Article [34]

**Source**

5

**Researches of organizational culture and insights Document** 

Influence of organizational culture on innovativeness is examined. While organizational culture was found to have negative relationship with innovativeness, organizational resources showed a significant positive relationship with innovativeness among the

Influence of organizational culture on employees' attitude is analyzed. The impact of organizational culture affecting performance was found to be the main issue that merits

This is an empirical research of organizational culture and work and environmental learning transfer factors in organizations. Flexible organizations (defined as mainly clan and/or adhocracy cultures) support learning transfer environment more than stable

The relationships of four elements of organizational culture, such as trust, employee communication, reward, management, learning and development, organizational socialization and knowledge transfer in the public sector organizations, are examined. According to the authors, socialization is found to play a moderating role in all the hypothesized relationships except between reward and knowledge transfer

The relationship between organizational culture and early mortality of the patients of healthcare institutions with HIV is examined. It was found that deliberate efforts to improve individual health facility leadership and inculcate an adhocratic culture may

The influence of supervisor's job insecurity on the subordinates' work was investigated; it was also aimed to test the moderating role of organizational culture between supervisor's job insecurity and the subordinates' prosocial voice. Results of this research foster the creation of an organizational culture, allowing subordinates to challenge their supervisor's

Authors researched relationships among green organizational culture, green innovation and competitive advantage in the hotel industry. It was found that green organizational

The relationship of business process management with the types of organizational culture is examined. Organizations perform more successfully when, for example, the business process management initiative is rolled out in the entire organization if the organization

The reasons for which academics quit jobs, in the context of the impact of leadership, organizational commitment and organizational culture are examined. It is concluded that the leaders should recognize the leadership impact, as leaders' behavior can motivate the

commitment of higher school employees and reduce the turnover intentions

culture has a positive effect on green innovation and competitive advantage

A model in which the firm's cultural fit changes with the sequence of knowledge management-based business processes including sharing, learning, evaluation and production is presented and then analytically investigated the design of knowledge sharing rewards as well as the business process sequence to shape a firm's organizational cultural

Associations between teamwork, innovation, orientation to results, attention to detail and environmental performance management model are examined. It is stated that teamwork is positively associated with the extent use of environmental activity analysis, innovation is positively associated with the extent use of both environmental activity cost analysis and environmental activity-based costing and attention to detail is positively associated with

shipbuilding companies

4 Organizational Culture

attention from this research

lower mortality and morbidity

fit and maximize its profit

has clan, market or hierarchy culture, etc.

decisions

the extent use of environmental activity-based costing

organizations (defined as market and/or hierarchy cultures)

**type**

Article [13]

Article [14]

Article [15]

Article [16]

Article [17]

Article [18]

Article [19]

Article [20]

Article [21]

Article [22]

Article [23]

**Source**



**Results of researches Document type Source**

Introductory Chapter: Organizational Culture - How Much Underused Potential Does Science Have?

Article [36]

7

http://dx.doi.org/10.5772/intechopen.81134

Article [37]

Note [38]

Article [39]

Book review [40]

Article [41]

Article [42]

Article [43]

Article [44]

Article [45]

Book review [46]

Article [2]

Article [48]

Review [49]

Note [50]

Proceeding paper

[47]

[51]

Editorial material

It was determined that in volunteer organizations security-oriented normative beliefs

The author, based on practical experience in the steel industry, grounds the role of the

are negatively related to both fund-raising success and to staff job attitudes

organizational culture to organizational changes

organization and enhances their commitment

ago has current value for school organizational culture

with attendant consequences for academic culture

features that are distinguished in the book is highlighted

medium for development of organizational culture theory

organizational psychology is presented

management science or management is developed

organizational activity is highlighted

membership in the organization

in particular

manipulation

discussed

events

The results of this research indicate that people who interacted with each other had similar interpretations of organizational events and that members of different interaction groups attached qualitatively different meanings to similar organizational

Organizational culture is defined as a system of shared values which produces normative pressure inside organizations, affects motivation or members of the

With reference to Schein, the meaning of organizational culture and leadership to

It is stated that the concept of 'rite' developed by an anthropologist nearly a century

It was determined that measurements of employee values differed more according to the demographic criteria of nationality, age and education than according to

It is stated that there is increased dependence of academic science on external resources

Members of an organization are confronting contradictory management signals, which cause a problem of double bind phenomenon. According to the author, understanding the double bind phenomenon should be seen as being important for managing organizations in general and for the change and the management of change

A significance of organizational culture's structural elements, functions and thinking

In the theories of organizations, a new concept of organizational health by relating it with culture and assessing the factors influencing employees' health is grounded

The demand for new ideas on effective management in a society creates a favorable

By analyzing friendship patterns, it is stated that the control of organizational diversity may be as much an interpersonal initiative as it is a prerogative of management

The author's attitude to how a culture should be defined and analyzed in the field of

By assessing the fact that managers of organizations must deal with high amounts of uncertainty, a discussion in the context of organizational culture how it is related to

Attempts to reform organizational culture in the Chinese national context are

The authors present a quantitative approach in measuring and interpreting organizational culture based on established norms and expected behavior, by

supplementing methodology of organizational culture researches

**Table 2.** Researches of organizational culture in publications of 2018.

etc.), at the areas of activity of the investigated organizations and at the topics, we can see that considerable attention is also given to organizations operating in developing markets, covering a wide range of organizational activities and impact on the society in the context of organizational culture in recent years. In response to the challenges faced by organizations, researchers turn their attention to the interactions of organizational culture with the efficiency of the organization, management of activity and leadership problems. The relationship with employees is particularly highlighted, as well as their response to actions of the organization. Knowledge management, responsibility to the stakeholders, relations with them, etc. are also emphasized. Aspects of organizational culture and climate and classical distribution of organizational culture, on the basis of which researches are carried out in modern organizations, remain relevant in research perspective, together with the emerging understanding of the significance of networks of relationships between persons within and outside organizations on organization culture, which provides the background for update of theoretical approaches. Despite abundant research to examine organizational culture and existing theories, the contexts of national social and cultural distinctions provide new aspects and expand the knowledge of the analyzed phenomenon.

Thus, in comparison with the papers, which were published in 1990 (**Table 3**), we see how the thematic field expanded on the basis of measurement and assessment of organizational culture developed by the researches in recent decades, strengthened by organizational culture impact on innovation, knowledge management and relationships not only within an organization but also between different organizations.

A considerable part of published papers were reviews of researches significant for the development of theory. Schein's organizational culture system, distinguishing in this context, undoubtedly influenced the subsequent researchers, alongside grounding the relationships of organizational culture and organizational climate, leadership, laying the foundations of measuring and interpreting, etc. The insights of Hofstede [55–57] about the impact of the national culture on organizational culture opened new areas of research that expand the understanding of organizational culture, as well as raise new objectives to the scientists researching the phenomenon and provide new opportunities to international companies to apply national specificities and differences in practice [58, 59, 33]. So, on the one hand, this brief comparison of the episodes of research of 1990 and 2018 shows how scientists' view penetrated into the depth and broadened in response to the emerging challenges. On


etc.), at the areas of activity of the investigated organizations and at the topics, we can see that considerable attention is also given to organizations operating in developing markets, covering a wide range of organizational activities and impact on the society in the context of organizational culture in recent years. In response to the challenges faced by organizations, researchers turn their attention to the interactions of organizational culture with the efficiency of the organization, management of activity and leadership problems. The relationship with employees is particularly highlighted, as well as their response to actions of the organization. Knowledge management, responsibility to the stakeholders, relations with them, etc. are also emphasized. Aspects of organizational culture and climate and classical distribution of organizational culture, on the basis of which researches are carried out in modern organizations, remain relevant in research perspective, together with the emerging understanding of the significance of networks of relationships between persons within and outside organizations on organization culture, which provides the background for update of theoretical approaches. Despite abundant research to examine organizational culture and existing theories, the contexts of national social and cultural distinctions provide new aspects and expand the knowl-

**type**

Article [35]

**Source**

**Researches of organizational culture and insights Document** 

Government support and influence of organizational culture on sustainable construction are examined. Positive relationship between adhocracy culture and sustainable construction was found; however, government support was found to moderate the relationship between adhocracy culture and sustainable construction, while an insignificant interaction effect was found between market orientation and sustainable construction

**Table 2.** Researches of organizational culture in publications of 2018.

Thus, in comparison with the papers, which were published in 1990 (**Table 3**), we see how the thematic field expanded on the basis of measurement and assessment of organizational culture developed by the researches in recent decades, strengthened by organizational culture impact on innovation, knowledge management and relationships not only within an organi-

A considerable part of published papers were reviews of researches significant for the development of theory. Schein's organizational culture system, distinguishing in this context, undoubtedly influenced the subsequent researchers, alongside grounding the relationships of organizational culture and organizational climate, leadership, laying the foundations of measuring and interpreting, etc. The insights of Hofstede [55–57] about the impact of the national culture on organizational culture opened new areas of research that expand the understanding of organizational culture, as well as raise new objectives to the scientists researching the phenomenon and provide new opportunities to international companies to apply national specificities and differences in practice [58, 59, 33]. So, on the one hand, this brief comparison of the episodes of research of 1990 and 2018 shows how scientists' view penetrated into the depth and broadened in response to the emerging challenges. On

edge of the analyzed phenomenon.

Source: own.

6 Organizational Culture

zation but also between different organizations.


[8] Tian M, Deng P, Zhang Y, Salmador MP. How does culture influence innovation? A systematic literature review. Management Decision. 2018;**56**(5):1088-1107. DOI: 10.1108/

Introductory Chapter: Organizational Culture - How Much Underused Potential Does Science Have?

http://dx.doi.org/10.5772/intechopen.81134

9

[9] Scott T, Mannion R, Marshall M, Davies H. Does organisational culture influence health care performance? A review of the evidence. Journal of Health Services Research &

[10] Seymen OA. The cultural diversity phenomenon in organisations and different approaches for effective cultural diversity management: A literary review. Cross Cultural Management: An International Journal. 2006;**13**(4):296-315. DOI: 10.1108/1352760

[11] Johnson A, Nguyen H, Groth M, Wang K, Ng JL. Time to change: A review of organisational culture change in health care organisations. Journal of Organizational Effectiveness:

[12] Vom Brocke J, Sinnl T. Culture in business process management: A literature review. Business Process Management Journal. 2011;**17**(2):357-378. DOI: 10.1108/1463715

[13] Kamaruddeen AM, Koh CT, Wahi W, Yii ATM. Organizational culture, resources, and innovativeness of shipbuilding companies: Moderating role of external factors. International Journal of Advanced and Applied Sciences. 2018;**5**(4):42-55. DOI: 10.21833/

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[17] Rahman MH, Moonesar IA, Hossain MM, Islam MZ. Influence of organizational culture on knowledge transfer: Evidence from the government of Dubai. Journal of Public

[18] Ayah R. Scaling up implementation of ART: Organizational culture and early mortality of patients initiated on ART in Nairobi, Kenya. PLoS One. 2018;**13**(1):e0190344. DOI:

[19] Gupta M, Ravindranath S, Kumar YLN. Voicing concerns for greater engagement: Does a supervisor's job insecurity and organizational culture matter? Evidence-Based HRM-A Global Forum for Empirical Scholarship. 2018;**6**(1):54-65. DOI: 10.1108/

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People and Performance. 2016;**3**(3):265-288. DOI: 10.1108/JOEPP-06-2016-0040

Policy. 2003;**8**(2):105-117. DOI: 10.1258/135581903321466085

MD-05-2017-0462

0610713404

1111122383

ijaas.2018.04.006

2018;**22**(1):15-33. DOI: 10.1111/ijtd.12116

10.1371/journal.pone.0190344

EBHRM-12-2016-0034

1080/02642069.2017.1402889

Affairs. 2018;**18**(1):e1696. DOI: 10.1002/pa.1696

**Table 3.** Organizational culture research directions in the publications of 1990.

the other hand, it shows the complexity and multidimensionality of the phenomenon of organizational culture, and it becomes the untapped potential for new studies.

### **Author details**

Jolita Vveinhardt

Address all correspondence to: jolita.vveinhardt@gmail.com

Vytautas Magnus University, Lithuania

### **References**


the other hand, it shows the complexity and multidimensionality of the phenomenon of

**Results of researches Document type Source**

Proceeding paper

Proceeding paper

Proceeding paper

[52]

[53]

[54]

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Address all correspondence to: jolita.vveinhardt@gmail.com

The authors state that engineers who want to manage and change organizational culture must become comfortable with hoopla and symbolism to add drama and life to

culture and communication with managers is grounded

relationship of VDT and employees' health

In complex a significance of employees' perception on ethical behavior, organizational

In the context of organizational culture, the issues of ergonomics, group relationship, employees' development and managers' training are analyzed. The focus is on the

**Table 3.** Organizational culture research directions in the publications of 1990.

1990;**5**(4):19-26. DOI: 10.1108/02683949010001520

31-49. DOI: 10.1177/000169939003300103

2001. 224 p. ISBN-13: 978-0887309991

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rde.v15i2.1023

Vytautas Magnus University, Lithuania

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their words and plans

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Source: own.

Jolita Vveinhardt

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**Chapter 2**

**Provisional chapter**

**Model of Culture for Innovation**

**Model of Culture for Innovation**

DOI: 10.5772/intechopen.81002

In the current economic panorama, innovation is considered to be an important source of sustainable competitive advantage. The literature indicates that organizational culture is one of the most important factors in innovation stimulation, given that influencing employee behavior promotes the acceptance of innovation as a fundamental organizational value and employee commitment to it. As such, organizations should concentrate on promoting an innovative culture that permits the institutionalization of innovation, which may occur by way of planned action or by means controlled by leaders or indirect mechanisms, such as structures, procedures, or institutional policy declarations. The importance of an innovative culture model which serves as a basis for cultural transformation emerges therefrom. Previous investigations have addressed innovative culture models focused on cultural traits and/or cultural determinants. The present study offers a holistic innovative culture model that in addition to addressing cultural traits and their determinants, as is done in other models, and takes into account management competencies and organizational capacities that are required to conform to cultural traits, to achieve innovative behavior on the part of the individuals of the

**Keywords:** organizational culture, innovation, innovative culture, cultural traits, model

In a competitive global market, innovation is the source of a sustainable competitive advantage and has a significant impact on organizational results [1, 2]. Additionally, it is considered

the basis for economic development and higher-than-average profits in the sector [3].

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

© 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use,

distribution, and reproduction in any medium, provided the original work is properly cited.

Additional information is available at the end of the chapter

Additional information is available at the end of the chapter

Julia C. Naranjo-Valencia and Gregorio Calderon-Hernández

Julia C. Naranjo-Valencia

**Abstract**

organization.

**1. Introduction**

innovative culture

http://dx.doi.org/10.5772/intechopen.81002

and Gregorio Calderon-Hernández


**Chapter 2 Provisional chapter**

#### **Model of Culture for Innovation Model of Culture for Innovation**

Julia C. Naranjo-Valencia and Gregorio Calderon-Hernández Julia C. Naranjo-Valencia and Gregorio Calderon-Hernández

Additional information is available at the end of the chapter Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.81002

#### **Abstract**

[47] Cox T, Howarth I. Organizational health, culture and helping. Work and Stress. 1990;

[48] Krackhardt D, Kilduff M. Friendship patterns and culture—The control of organizational diversity. American Anthropologist. 1990;**92**(1):142-154. DOI: 10.1525/aa.1990.

[49] Schein EH. Organizational culture. The American Psychologist. 1990;**45**(2):109-119. DOI:

[50] Gummer B. Managing organizational cultures—Management science or management ideology. Administration in Social Work. 1990;**14**(1):135-153. DOI: 10.1300/J147v14n01\_09

[51] Barnowe JT. Paradox resolution in Chinese attempts to reform organizational cultures. Advances in Chinese Industrial Studies: A Research Annual. 1990;**1**:A329-A347

[52] Kurstedt HA, Mallak LA, Howard EM, Kurstedt PS. Why engineers must know and manage organizational culture. In: IEEE International Engineering Management Conference: Management through the Year 2000—Gaining the Competitive Advantage.

[53] Braun VL, Arnold WE. Employees perceptions of ethical behaviors, organizational culture, and superior-subordinate communication. In: Proceedings of the First National

[54] Westin AF. Organizational culture and VDT policies—A case-study of the federal express corporation. In: Promoting Health and Productivity in the Computerized Office:

[55] Hofstede G. Culture's Consequences: International Differences in Work-Related Values (Cross Cultural Research and Methodology). CA: Sage: Beverly Hills; 1984. 328 p. ISBN-

[56] Hofstede G. Cultures and Organizations: Software of the Mind. 3rd ed. London, UK:

[57] Hofstede G. Dimensionalizing cultures: The Hofstede model in context. Online Readings in Psychology and Culture. 2011;**2**(1). DOI: 10.9707/2307-0919.1014. https://scholarworks.

[58] Miroshnik V. Culture and international management: A review. Journal of Management

[59] Kanungo RP. Cross culture and business practice: Are they coterminous or crossverging? Cross Cultural Management: An International Journal. 2006;**13**(1):23-31. DOI:

**4**(2):107-110. DOI: 10.1080/02678379008256972

1990. pp. 159-163. DOI: 10.1109/IEMC.1990.201271

Communication Ethics Conference. 1990. pp. 202-214

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McGraw-Hill Education; 2010. 576 p. ISBN-13: 978-0071664189

Development. 2002;**21**(7):521-544. DOI: 10.1108/02621710210434647

92.1.02a00100

12 Organizational Culture

13: 978-0803913066

gvsu.edu/orpc/vol2/iss1/8/

10.1108/13527600610643457

10.1037//0003-066X.45.2.109

In the current economic panorama, innovation is considered to be an important source of sustainable competitive advantage. The literature indicates that organizational culture is one of the most important factors in innovation stimulation, given that influencing employee behavior promotes the acceptance of innovation as a fundamental organizational value and employee commitment to it. As such, organizations should concentrate on promoting an innovative culture that permits the institutionalization of innovation, which may occur by way of planned action or by means controlled by leaders or indirect mechanisms, such as structures, procedures, or institutional policy declarations. The importance of an innovative culture model which serves as a basis for cultural transformation emerges therefrom. Previous investigations have addressed innovative culture models focused on cultural traits and/or cultural determinants. The present study offers a holistic innovative culture model that in addition to addressing cultural traits and their determinants, as is done in other models, and takes into account management competencies and organizational capacities that are required to conform to cultural traits, to achieve innovative behavior on the part of the individuals of the organization.

DOI: 10.5772/intechopen.81002

**Keywords:** organizational culture, innovation, innovative culture, cultural traits, model innovative culture

### **1. Introduction**

In a competitive global market, innovation is the source of a sustainable competitive advantage and has a significant impact on organizational results [1, 2]. Additionally, it is considered the basis for economic development and higher-than-average profits in the sector [3].

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. © 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

High R&D investment is insufficient to foster innovation. There must also be a culture present which motivates innovation, as well as an atmosphere which favors creativity, and eliminates obstacles to its success [12, 25]. The relevance of culture in innovation is explained by its individual characteristics, including uncertainty, high levels of risk, and unpredictability in innovation [4].

**2. Review of literature: approach to innovative culture**

and interaction with the environment of the company [29].

conducive to innovation [4]

client orientation, social network structure

risk-taking, and tolerance of failure

management of differences, teamwork [10] Autonomy/freedom, cannibalism, proactivity, risk assumption

**Table 1.** The components of innovative culture, according to various authors.

[24] Values, behaviors, clime, resources, processes, and perception of success

confidence)

market orientation

respond to market demands [12, 25–27].

innovative activity [31].

Innovative culture can be defined as the multidimensional atmosphere which includes the values, assumptions, and beliefs shared of the members of an organization that cause it to be prone to explore new opportunities and knowledge and generate innovation, in order to

Model of Culture for Innovation

15

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The concept additionally includes the intention to innovate, the organization's market orientation, and organizational learning but further involves the existence of certain specific features which are many and various, in accordance with the author who proposes them [4, 28]. Innovation culture is considered to be an intangible strategic resource [27] which leads to increased adaptability. As such, it generates adaptive advantages as it promotes collaboration

Additionally, it promotes initiative instead of obedience and dependence [30] and stimulates practices like creativity, freedom of thought, openness, and flexibility, all of which increase

Various authors have studied innovative culture, the majority of them concentrate on individual features and behaviors to understand this phenomenon, although some have used more holistic models which include organizational factors. In **Table 1**, the components of

[22] Structure, strategy, support mechanisms, behavioral patterns, and communication

[81] Innovative intention, infrastructure to support innovation, market orientation, and a setting

[9] Values (growth/development, external confidence, freedom/latitude, attitude to risk, internal

[32] Freedom/tolerance, risk orientation, growth/development, internal and external confidence, external perspective, clear objectives, teamwork infrastructure

[33] Teamwork and knowledge exchange, delegation and recognition, R&D (obstacles), risk-taking,

[27] Orientation toward technological innovation and knowledge, willingness to take risks, and

[34] Market orientation, organizational learning, openness to new solutions, technology, markets,

[12] Knowledge exchange and open communication, learning and social development, networks and

Instruments (clear objectives, company infrastructure, external perspective, team constitution)

external cooperation, allocation of free time, tolerance for errors, reward and incentive systems,

It has been documented that an appropriate culture stimulates product innovation [5–7] as much as process and marketing innovation [3, 8]. Similarly, it can stimulate incremental innovation as well as radical or ambidextrous innovation [9, 10].

Consequently, given the significant influence of organizational culture on a company's propensity to innovate [11], and considering that it may become either a facilitator or inhibitor, organizational effort cannot be limited to the generation of new products or processes but rather should focus on the promotion of an innovative culture, which helps to institutionalize innovation [12].

Organizational culture is the set of meanings, basic presumptions, values, and beliefs which are shared by the members of an organization [13, 14] and is the way that things are done here [9]. It identifies the members of an organization, guides its behavior [15, 16], and influences the way in which the organization does business and reacts to the environment [17, 18]. One important role of culture is guiding perception toward that which is important, desirable, acceptable [19] and, as such, may be compensated.

Although there is no consensus regarding the possibility of intentional intervention, there is a large group of authors who believe it possible [14, 15, 20, 21]. Such an intervention could be performed directly, via planned action and means which can be controlled either by leaders or indirect mechanisms like structures, procedures, or institutional policy declarations. This is the basis for considering the creation of an innovative culture model which can be developed by companies and which would be the foundation for cultural transformation. This is the goal of the present chapter.

Although many authors have addressed the topic of innovative culture [9, 22–24], it is thought that an operational formulation that facilitates its implementation on an organizational level is still lacking [12]. The present study's main contribution is the proposal of a holistic innovative culture model. In addition to addressing cultural traits and its determinants, as done in other models, it further takes into account management competencies and organizational capacities that are required to conform to cultural traits, to achieve innovative behavior on the part of individuals and the organization.

For the construction of the innovative culture model, a literature review of descriptive nature was performed and subsequently contrasted with the results of the authors' consulting activities.

This chapter is structured as follows: it begins by describing the concept of innovative culture, the different approaches to the said culture that have been examined in the literature, and the dimensions which have been suggested by various authors. Next, the methodology is presented. Later, the proposed model is provided, and, finally, conclusions are drawn.

## **2. Review of literature: approach to innovative culture**

High R&D investment is insufficient to foster innovation. There must also be a culture present which motivates innovation, as well as an atmosphere which favors creativity, and eliminates obstacles to its success [12, 25]. The relevance of culture in innovation is explained by its individual characteristics, including uncertainty, high levels of risk, and unpredictability in

It has been documented that an appropriate culture stimulates product innovation [5–7] as much as process and marketing innovation [3, 8]. Similarly, it can stimulate incremental inno-

Consequently, given the significant influence of organizational culture on a company's propensity to innovate [11], and considering that it may become either a facilitator or inhibitor, organizational effort cannot be limited to the generation of new products or processes but rather should focus on the promotion of an innovative culture, which helps to institutionalize

Organizational culture is the set of meanings, basic presumptions, values, and beliefs which are shared by the members of an organization [13, 14] and is the way that things are done here [9]. It identifies the members of an organization, guides its behavior [15, 16], and influences the way in which the organization does business and reacts to the environment [17, 18]. One important role of culture is guiding perception toward that which is important, desirable,

Although there is no consensus regarding the possibility of intentional intervention, there is a large group of authors who believe it possible [14, 15, 20, 21]. Such an intervention could be performed directly, via planned action and means which can be controlled either by leaders or indirect mechanisms like structures, procedures, or institutional policy declarations. This is the basis for considering the creation of an innovative culture model which can be developed by companies and which would be the foundation for cultural transformation. This is the goal

Although many authors have addressed the topic of innovative culture [9, 22–24], it is thought that an operational formulation that facilitates its implementation on an organizational level is still lacking [12]. The present study's main contribution is the proposal of a holistic innovative culture model. In addition to addressing cultural traits and its determinants, as done in other models, it further takes into account management competencies and organizational capacities that are required to conform to cultural traits, to achieve innovative behavior on the

For the construction of the innovative culture model, a literature review of descriptive nature was performed and subsequently contrasted with the results of the authors' consulting

This chapter is structured as follows: it begins by describing the concept of innovative culture, the different approaches to the said culture that have been examined in the literature, and the dimensions which have been suggested by various authors. Next, the methodology is presented. Later, the proposed model is provided, and, finally, conclusions are drawn.

vation as well as radical or ambidextrous innovation [9, 10].

acceptable [19] and, as such, may be compensated.

innovation [4].

14 Organizational Culture

innovation [12].

of the present chapter.

activities.

part of individuals and the organization.

Innovative culture can be defined as the multidimensional atmosphere which includes the values, assumptions, and beliefs shared of the members of an organization that cause it to be prone to explore new opportunities and knowledge and generate innovation, in order to respond to market demands [12, 25–27].

The concept additionally includes the intention to innovate, the organization's market orientation, and organizational learning but further involves the existence of certain specific features which are many and various, in accordance with the author who proposes them [4, 28].

Innovation culture is considered to be an intangible strategic resource [27] which leads to increased adaptability. As such, it generates adaptive advantages as it promotes collaboration and interaction with the environment of the company [29].

Additionally, it promotes initiative instead of obedience and dependence [30] and stimulates practices like creativity, freedom of thought, openness, and flexibility, all of which increase innovative activity [31].

Various authors have studied innovative culture, the majority of them concentrate on individual features and behaviors to understand this phenomenon, although some have used more holistic models which include organizational factors. In **Table 1**, the components of


**Table 1.** The components of innovative culture, according to various authors.

innovative culture, which have been used by certain researchers, are summarized. Below, the models proposed by certain authors are analyzed in greater detail.

competencies, and the organizational capabilities which adjust cultural traits and, as a result, behavior roles for innovation. This innovative culture finally leads to innovation results.

Model of Culture for Innovation

17

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A descriptive literature review was carried out and later contrasted with the results of the authors' consulting activities. In accordance with Marins and Terblanche [22], the management science literature has been used to describe the organizational culture, creativity, and

(1) The theoretical and empirical literature was reviewed, in regard to determinants of

(3) The literature on cultural factors which influence the innovative behavior of employees

(5) The culture for innovation categories which had emerged in the authors' consulting

(6) The literature review performed in steps 1–3 was contrasted with the models proposed

(7) Based on the comparison, the need for adjustment between cultural traits and two organizational setting elements, management competencies and organizational abilities,

(8) Innovative culture was modeled on three levels of analysis: determinants of culture, cultural traits adjusted to organizational abilities and management competencies, and

(10) Each one of the categories was described, in function of its pertinence or relationship to

The model proposed here is a holistic model which permits an understanding of those elements which interact in an innovative culture from a broader scope. The elements which

The steps used for the construction of the innovative culture model are the following:

(2) The literature on cultural determinants that favor innovation was reviewed.

(4) The innovative culture models proposed in the literature were analyzed.

in the literature (step 4) and with the emerging categories (step 5).

(9) The dimensions of each one of the analysis level categories were identified.

compose the said model are separated into five categories and four levels.

**3. Methodology**

culture.

was reviewed.

work was analyzed.

was established.

behavioral roles.

innovative culture.

**4. Proposed model for innovative culture**

innovation present in organizations.

Martins and Terblanche [22], supported by the organizational culture model developed by Martins [35, 36], create a proposal to explain the specific determinants of cultures which promote innovation and creativity in organizations. These authors consider six determinants:


McLaughlin [9], based on Greenwood and Hinings' (1993) concept of organizational archetypes and on Schein's (1984) organizational culture model, proposes certain characteristics to consider, in order to create a radical innovation culture model. These characteristics are procedures, structure, people, organizational aspects, focus, and management. Each one of these is analyzed continuously, from incremental innovation to radical innovation.

Another model considered was that of Büschgens et al. [11], in which it is concluded that Quinn and Rohrbaugh's [37] Competing Values Framework constitutes a model appropriate for the comprehension of the culture-innovation relationship. They consider three dimensions such as flexibility versus control, external versus internal orientation, and organizational means and ends, which, in accordance with their conclusions, synthesize the multiple variables which have been used for the study of innovative culture.

Lastly, Rao and Weintraub [24] propose six innovative culture components. *Values*, which determine organizational priorities and decisions; *behaviors*, which are the way in which employees act when faced with innovation; *climate*, which challenges one to take risks in safe environments and promotes learning and independent thought; *resources*, which include people, systems, and projects; *processes*, which are considered to be the route to innovation development; and, finally, the perception of *success* on external, business, and personal levels.

In conclusion, the models presented have focused on cultural traits [9] or on traits and their determinants [11]. The present proposal precisely aims to remedy this limitation by proposing a model which joins innovative culture determinants, innovative cultural traits, management competencies, and the organizational capabilities which adjust cultural traits and, as a result, behavior roles for innovation. This innovative culture finally leads to innovation results.

### **3. Methodology**

innovative culture, which have been used by certain researchers, are summarized. Below, the

Martins and Terblanche [22], supported by the organizational culture model developed by Martins [35, 36], create a proposal to explain the specific determinants of cultures which promote innovation and creativity in organizations. These authors consider six determinants:

• *Strategy*, emphasized by individual understanding and appropriation of the mission and

• *Structure* reflects organizational values. Thus, the flexibility, freedom, collaborative work, decision-making speed, empowerment, and teamwork that are reflected in the structure

• *Support mechanisms*, such as rewarded behavior, use of information technology in processes,

• *Behaviors that promote innovation* include error management, encouragement of new idea generation, fair idea evaluation, support for curiosity, risk-taking, experimentation, reduced control, encouragement of competition, a positive attitude toward change, toler-

• Lastly, *communication* is open, transparent, and based on trust, which promotes the idea

McLaughlin [9], based on Greenwood and Hinings' (1993) concept of organizational archetypes and on Schein's (1984) organizational culture model, proposes certain characteristics to consider, in order to create a radical innovation culture model. These characteristics are procedures, structure, people, organizational aspects, focus, and management. Each one of

Another model considered was that of Büschgens et al. [11], in which it is concluded that Quinn and Rohrbaugh's [37] Competing Values Framework constitutes a model appropriate for the comprehension of the culture-innovation relationship. They consider three dimensions such as flexibility versus control, external versus internal orientation, and organizational means and ends, which, in accordance with their conclusions, synthesize the multiple

Lastly, Rao and Weintraub [24] propose six innovative culture components. *Values*, which determine organizational priorities and decisions; *behaviors*, which are the way in which employees act when faced with innovation; *climate*, which challenges one to take risks in safe environments and promotes learning and independent thought; *resources*, which include people, systems, and projects; *processes*, which are considered to be the route to innovation development; and, finally, the perception of *success* on external, business, and personal levels. In conclusion, the models presented have focused on cultural traits [9] or on traits and their determinants [11]. The present proposal precisely aims to remedy this limitation by proposing a model which joins innovative culture determinants, innovative cultural traits, management

and human management practices can also reinforce innovation and creativity.

ance and constructive conflict management, and constructive confrontation.

these is analyzed continuously, from incremental innovation to radical innovation.

that disagreement is acceptable, which also influences innovation.

variables which have been used for the study of innovative culture.

models proposed by certain authors are analyzed in greater detail.

vision, as well as goals and objectives.

are facilitators of innovation.

16 Organizational Culture

A descriptive literature review was carried out and later contrasted with the results of the authors' consulting activities. In accordance with Marins and Terblanche [22], the management science literature has been used to describe the organizational culture, creativity, and innovation present in organizations.

The steps used for the construction of the innovative culture model are the following:


### **4. Proposed model for innovative culture**

The model proposed here is a holistic model which permits an understanding of those elements which interact in an innovative culture from a broader scope. The elements which compose the said model are separated into five categories and four levels.

On the first level is the *determinants of culture*. These factors determine or generate a certain type of culture. For effects of an innovative culture, both the literature review and author experience in organizational processes lead to the proposal of five factors: strategy, structure, leadership, metrics, and environmental.

On the second level is the cultural essence, or *cultural traits*. This category identifies the content of the culture. On this same level, two additional categories are included, in which, although they are not determinants of culture as such, they do affect them in terms of adjustment: *management competencies* and *organizational capabilities*. In other words, for these competencies and capabilities to take root in the organizational essence, certain specific cultural traits must be developed.

It is considered vital to develop the following seven managing organizational competencies for the innovative culture model: communication, teamwork, tolerance for error, conflict management, decision-making, simplicity and agility, and prioritization. Seven organizational capabilities must also be cultivated: ambidexterity, customer and market orientation, speed, relationships, execution, adaptability, and entrepreneurial orientation. Consequently, there are nine cultural traits of innovation: freedom, risk-taking, commitment and trust, mental flexibility, confrontation, acceptance of diversity, curiosity, association, and respect.

On the third level, and as an effect of the existence of certain innovative cultural traits, the *behavioral roles*, or innovative behavior, this category is found in the organization which identifies with the three innovation phases: idea generation (inventors), idea promotion (champions), and development (implementers).

Lastly, the *results* of innovative culture are presented. These can be in the form of continuous or disruptive, technological (product or process), organizational, or marketing innovations. **Figure 1** presents these components.

an organizational capability which indicates top management's inclination to take business-

Model of Culture for Innovation

19

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The possibility and convenience of organizational culture intervention have been debated since the seminal work of Smircich [13]. Some authors consider culture to be "something" that an organization IS, which thus cannot be intentionally modified [38], while others believe that culture is something that an organization HAS, which therefore can be modified through

In the present investigation, the latter position is assumed, which makes the formulation of a desirable innovative culture model, as well as organizational action to achieve this, viable. Various authors [22, 40] agree in the existence of five determining factors of innovative cul-

*Strategy*, considered to be the cornerstone of organizational design, is based on the mission, vision, and short- and long-term objectives [41]. Strategy, through the formulation of goals and objectives, indirectly reflects organizational priorities and values and, as such, inspires

Uncovering the meaning of the goals and objectives and achieving employee understanding of the mission and vision lend a special value to the promotion of creativity and innovation in

related risks.

its members.

organizational members [22].

**4.1. Determinants of culture**

**Figure 1.** Model of culture for innovation.

organizational management [15, 18, 39].

ture: strategy, structure, leadership, metrics, and environmental.

A number of the model's characteristics should be emphasized:


This is the case, for example, of risk-taking. The literature makes reference to risk-taking, risk assumption, willingness to risk, risk orientation, and error tolerance, as a fundamental element of innovative culture. In the model proposed here, this variable is delimited and differentiated. It includes risk-taking as a cultural trait of the individual, tolerance for error as a management behavior which relates to reasonable acceptance of error, and risk orientation as

**Figure 1.** Model of culture for innovation.

On the first level is the *determinants of culture*. These factors determine or generate a certain type of culture. For effects of an innovative culture, both the literature review and author experience in organizational processes lead to the proposal of five factors: strategy, structure,

On the second level is the cultural essence, or *cultural traits*. This category identifies the content of the culture. On this same level, two additional categories are included, in which, although they are not determinants of culture as such, they do affect them in terms of adjustment: *management competencies* and *organizational capabilities*. In other words, for these competencies and capabilities to take root in the organizational essence, certain specific cultural traits must be developed.

It is considered vital to develop the following seven managing organizational competencies for the innovative culture model: communication, teamwork, tolerance for error, conflict management, decision-making, simplicity and agility, and prioritization. Seven organizational capabilities must also be cultivated: ambidexterity, customer and market orientation, speed, relationships, execution, adaptability, and entrepreneurial orientation. Consequently, there are nine cultural traits of innovation: freedom, risk-taking, commitment and trust, mental

On the third level, and as an effect of the existence of certain innovative cultural traits, the *behavioral roles*, or innovative behavior, this category is found in the organization which identifies with the three innovation phases: idea generation (inventors), idea promotion (champi-

Lastly, the *results* of innovative culture are presented. These can be in the form of continuous or disruptive, technological (product or process), organizational, or marketing innovations.

(1) The causality and adjustment relationships both between and within the different levels

(3) Its undertaking of both the individual and the organization, which causes one to value

(4) Comprehension improvement of the different elements present in an innovative culture—determinants of culture, cultural traits, management competencies, organizational capabilities, and behavioral roles—inasmuch as it delimits them and defines its connota-

This is the case, for example, of risk-taking. The literature makes reference to risk-taking, risk assumption, willingness to risk, risk orientation, and error tolerance, as a fundamental element of innovative culture. In the model proposed here, this variable is delimited and differentiated. It includes risk-taking as a cultural trait of the individual, tolerance for error as a management behavior which relates to reasonable acceptance of error, and risk orientation as

tion, depending on the model category to which they belong within the model

flexibility, confrontation, acceptance of diversity, curiosity, association, and respect.

leadership, metrics, and environmental.

18 Organizational Culture

ons), and development (implementers).

**Figure 1** presents these components.

A number of the model's characteristics should be emphasized:

the difference between the person and the organization

(2) The difference between individual and organizational perspectives

an organizational capability which indicates top management's inclination to take businessrelated risks.

### **4.1. Determinants of culture**

The possibility and convenience of organizational culture intervention have been debated since the seminal work of Smircich [13]. Some authors consider culture to be "something" that an organization IS, which thus cannot be intentionally modified [38], while others believe that culture is something that an organization HAS, which therefore can be modified through organizational management [15, 18, 39].

In the present investigation, the latter position is assumed, which makes the formulation of a desirable innovative culture model, as well as organizational action to achieve this, viable. Various authors [22, 40] agree in the existence of five determining factors of innovative culture: strategy, structure, leadership, metrics, and environmental.

*Strategy*, considered to be the cornerstone of organizational design, is based on the mission, vision, and short- and long-term objectives [41]. Strategy, through the formulation of goals and objectives, indirectly reflects organizational priorities and values and, as such, inspires its members.

Uncovering the meaning of the goals and objectives and achieving employee understanding of the mission and vision lend a special value to the promotion of creativity and innovation in organizational members [22].

*Structure* is one of the determinants of culture which is recognized in the specialized literature [22, 40, 41]. In the present model, the proposals of Damanpour [42] and Damanpour and Gopalakrishnan [43], who consider structural elements to be associated with innovation via two constructs, organizational complexity (specialization, functional differentiation, and professionalism) and bureaucratic control (centralization, formalization, and vertical differentiation) are used.

Companies which form part of a market with these idiosyncrasies should develop abilities which permit them to be continuously competitive. Products have short life cycles and become rapidly obsolete, which obliges companies to be highly innovative in order to continue at the speed of change. Souder and Song [56] found that, in conditions of great market uncertainty,

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Different investigations recommend studying culture from the point of view of content, which includes the basic characteristics valued by the organization or its operating values [57]. Cameron and Ettington's [58] study summarized by Cameron and Quinn [59] revealed the importance of cultural content, or cultural traits, as they found that organizational results were more closely associated with cultural traits than with congruency or cultural

Regarding cultural traits which should be present in an innovative culture, the review of theoretical literature and results of the authors' empirical studies [1, 40, 53, 40–69] indicate a consensus on the relevance of nine innovative culture traits: freedom, risk-taking, commitment and trust, mental flexibility, confrontation, acceptance of diversity, curiosity, associa-

*Freedom*, which manifests itself as autonomy, empowerment, and participation in decisionmaking, is one of the most common elements associated with an innovative culture. An atmosphere of freedom and autonomy increases the employees' intrinsic motivation, considered as

*Risk-taking* is generally associated with innovative personalities. These individuals have a high tolerance for ambiguity, wish to be challenged, and accept the risks of facing difficult challenges. They are patient and willing to persevere in order to resolve challenges, although

*Commitment*, understood as the degree to which individuals feel united with or tied to their organization or its parts [71], and *trust*, understood as the degree of emotional security that employees feel in their work relationships [72], are considered to be fundamental for the innovation process. In accordance with Amabile [73, 74] and Jafri [75], employees are only motivated to involve themselves in innovative activities if they are strongly identified with the organization. McLaughlin et al. [9] indicate that, in innovation processes, trusting teams to conduct their development projects, experimentation, collection activities, and idea selection,

*Mental flexibility* refers to openness and the ability to respond to new ideas, as well as a flexible approach to problem solving [6], which derives from an appreciation of novelty, a pursuit of variety, receptiveness to new ideas, and tolerance for the ambiguity associated with creativity

*Confrontation* is the ability to address situations without intimidating others or becoming intimidated. In this sense, beyond simply addressing a situation, one must have the ability to find similarities and differences between two or more positions, make them explicit, and

a key factor in promoting creativity in an organization [1].

without interference from management, is fundamental.

companies should highlight their technical superiority and revolutionary designs.

**4.2. Cultural traits for innovation**

strength.

tion, and respect.

they may be difficult [70].

and innovation [76, 77].

Organizational complexity is reflected in the quantity and diversity of specializations found therein, and the degree of professionalization of an organization's plant personnel makes innovation more probable, as a wide base of knowledge, together with self-confidence and the possibility to exchange ideas, motivates changes in the status quo and the degree of division into units—functional differentiation; frequently, it incites technological development and system improvement [43].

Once decentralization disperses the autonomy to make decisions, it favors creativity, communication, agility in decisions and, generally, the exploration of new knowledge and innovation [42, 44, 45]. While low formalization levels reduce the emphasis on rules and procedures, it allows for the perception of problems and circumstances from other perspectives, motivating the search for new solutions [46, 47]. Little vertical differentiation, or minimal hierarchical levels, facilitates communication and interaction.

*Leadership* is the ability to promote the innovation and creativity found among the highestlevel competencies required of leaders [48]. Evidence shows that the three determinant leadership factors for innovation are organizational stimulus, challenging work, and work group support [49].

Two types of leadership best respond to the three abovementioned determinants: transformational leadership [50], which is based on four components (idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration), and supportive leadership, which focuses on the satisfaction of employee needs and preferences, positive attitude development, and the promotion of trust in and of itself [30].

*Metrics and rewards*, in organizations, metrics and rewards serve the function of aligning individual behavior and performance with organizational objectives. Thus, employees perceive that the evaluation system (scorecard) and rewards communicate the company values more clearly than any written declaration [41]. In accordance with Nacinovic et al. [51], the creation of a corporate culture that promotes innovation begins with compensation systems, because the desired behaviors are rewarded and, as such, employees are motivated to repeat the said behaviors. A periodic employee evaluation system can be a crucial tool for employee motivation to change and adopt innovative behaviors, as this includes creativity and innovation criteria and values innovative practices [52].

The *environment* constitutes a determinant of culture, in that the most dynamic environment, as compared to the most stable environment, demands different cultural feature emphases. More dynamic environments are characterized by market and technological uncertainty and competitive intensity [53], which means that competitor product design changes, consumer demand for new products, the technology which affects how products are used or manufactured, market structure changes, and the degree of competition are unpredictable [54, 55].

Companies which form part of a market with these idiosyncrasies should develop abilities which permit them to be continuously competitive. Products have short life cycles and become rapidly obsolete, which obliges companies to be highly innovative in order to continue at the speed of change. Souder and Song [56] found that, in conditions of great market uncertainty, companies should highlight their technical superiority and revolutionary designs.

### **4.2. Cultural traits for innovation**

*Structure* is one of the determinants of culture which is recognized in the specialized literature [22, 40, 41]. In the present model, the proposals of Damanpour [42] and Damanpour and Gopalakrishnan [43], who consider structural elements to be associated with innovation via two constructs, organizational complexity (specialization, functional differentiation, and professionalism) and bureaucratic control (centralization, formalization, and vertical differ-

Organizational complexity is reflected in the quantity and diversity of specializations found therein, and the degree of professionalization of an organization's plant personnel makes innovation more probable, as a wide base of knowledge, together with self-confidence and the possibility to exchange ideas, motivates changes in the status quo and the degree of division into units—functional differentiation; frequently, it incites technological development and

Once decentralization disperses the autonomy to make decisions, it favors creativity, communication, agility in decisions and, generally, the exploration of new knowledge and innovation [42, 44, 45]. While low formalization levels reduce the emphasis on rules and procedures, it allows for the perception of problems and circumstances from other perspectives, motivating the search for new solutions [46, 47]. Little vertical differentiation, or minimal hierarchical

*Leadership* is the ability to promote the innovation and creativity found among the highestlevel competencies required of leaders [48]. Evidence shows that the three determinant leadership factors for innovation are organizational stimulus, challenging work, and work group

Two types of leadership best respond to the three abovementioned determinants: transformational leadership [50], which is based on four components (idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration), and supportive leadership, which focuses on the satisfaction of employee needs and preferences, positive attitude

*Metrics and rewards*, in organizations, metrics and rewards serve the function of aligning individual behavior and performance with organizational objectives. Thus, employees perceive that the evaluation system (scorecard) and rewards communicate the company values more clearly than any written declaration [41]. In accordance with Nacinovic et al. [51], the creation of a corporate culture that promotes innovation begins with compensation systems, because the desired behaviors are rewarded and, as such, employees are motivated to repeat the said behaviors. A periodic employee evaluation system can be a crucial tool for employee motivation to change and adopt innovative behaviors, as this includes creativity and innovation

The *environment* constitutes a determinant of culture, in that the most dynamic environment, as compared to the most stable environment, demands different cultural feature emphases. More dynamic environments are characterized by market and technological uncertainty and competitive intensity [53], which means that competitor product design changes, consumer demand for new products, the technology which affects how products are used or manufactured, market structure changes, and the degree of competition are unpredictable [54, 55].

entiation) are used.

20 Organizational Culture

system improvement [43].

support [49].

levels, facilitates communication and interaction.

development, and the promotion of trust in and of itself [30].

criteria and values innovative practices [52].

Different investigations recommend studying culture from the point of view of content, which includes the basic characteristics valued by the organization or its operating values [57]. Cameron and Ettington's [58] study summarized by Cameron and Quinn [59] revealed the importance of cultural content, or cultural traits, as they found that organizational results were more closely associated with cultural traits than with congruency or cultural strength.

Regarding cultural traits which should be present in an innovative culture, the review of theoretical literature and results of the authors' empirical studies [1, 40, 53, 40–69] indicate a consensus on the relevance of nine innovative culture traits: freedom, risk-taking, commitment and trust, mental flexibility, confrontation, acceptance of diversity, curiosity, association, and respect.

*Freedom*, which manifests itself as autonomy, empowerment, and participation in decisionmaking, is one of the most common elements associated with an innovative culture. An atmosphere of freedom and autonomy increases the employees' intrinsic motivation, considered as a key factor in promoting creativity in an organization [1].

*Risk-taking* is generally associated with innovative personalities. These individuals have a high tolerance for ambiguity, wish to be challenged, and accept the risks of facing difficult challenges. They are patient and willing to persevere in order to resolve challenges, although they may be difficult [70].

*Commitment*, understood as the degree to which individuals feel united with or tied to their organization or its parts [71], and *trust*, understood as the degree of emotional security that employees feel in their work relationships [72], are considered to be fundamental for the innovation process. In accordance with Amabile [73, 74] and Jafri [75], employees are only motivated to involve themselves in innovative activities if they are strongly identified with the organization. McLaughlin et al. [9] indicate that, in innovation processes, trusting teams to conduct their development projects, experimentation, collection activities, and idea selection, without interference from management, is fundamental.

*Mental flexibility* refers to openness and the ability to respond to new ideas, as well as a flexible approach to problem solving [6], which derives from an appreciation of novelty, a pursuit of variety, receptiveness to new ideas, and tolerance for the ambiguity associated with creativity and innovation [76, 77].

*Confrontation* is the ability to address situations without intimidating others or becoming intimidated. In this sense, beyond simply addressing a situation, one must have the ability to find similarities and differences between two or more positions, make them explicit, and seek agreement. When there is a conflict between the different ideas, perceptions, and ways in which one may process and evaluate information, the conflict should be managed constructively, so as to promote creativity and innovation [22, 78].

creativity, it must be open and transparent; this promotes trust and transmits the idea that

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It must facilitate the free exchange of ideas, promoting horizontal communication between individuals, as well as between teams and departments, as this removes bureaucratic procedures [84, 85]. However, additionally, it should share lessons learned from both success and

Once the sensation of emotional security has been created, an employee may feel driven toward divergent thinking and discover new and creative possibilities, without fear of pun-

*Teamwork* is a critical competency used to both stimulate and support innovation [12], provided that empathy and trust are built, and the synergetic effect of participative and collective

Multifunctional teams (R&D, design, engineering, sales) are more effective if they are additionally able to exchange ways of thinking and expertise [48] with an open mind, so as to work with a certain degree of uncertainty and conflict [9]. All teams must have the support of

According to Leifer et al. [86], team members who work on radical innovation processes should combine their technical abilities with curiosity, passion, flexibility, and ability to take risks.

*Tolerance for error* has to do with accepting a reasonable margin of error especially the one that is committed trying new things that generate learnings [65]. It values the assumption of risk; encourages taking significant, calculated risks within the scope of one's work; and encourages defiance of the status quo, in an effort to produce positive results. It promotes employee experimentation with new ideas and doing things differently, without fear of negative consequences to their self-image, status, or professional career [6]. Successful organizations not only reward success but also tolerate mistakes, in order to create opportunities for discussion

When the organization permits a functional level of conflict, and when the management team is capable of *tolerating and constructively managing* conflict, innovative behavior is stimulated in organizations. This implies accepting different styles of thinking among the members of the organization but at the same time encouraging constructive confrontation

On the other hand, participative *decision-making*, which involves others and offers freedom and empowerment to perform one's job and choose the procedures to be used abiding by a

The complexity and dynamics of the global environmental demand that decision-making be quick and timely, in addition to being participative and efficient, which is characteristic of

Another important management competency for innovation is *simplicity and agility* in organizational processes. Managers should eliminate the belief that if something is simple and quick,

few minimal, predictable guidelines, is the source of creativity and innovation [22].

disagreement is acceptable within the organization [22].

work is understood.

a leader and appropriate resource allocation.

and learning from mistakes [22].

innovative organizations [30].

between them [22].

failure, tell stories which inspire, or warn of possible failings [48].

ishment [22]. This is achieved with open and unrestricted communication.

*Acceptance of diversity* concerns the ability to interact with different people (from varying hierarchical levels, stages of knowledge, external areas, and interdisciplinary areas). Work teams characterized by diversity, interdisciplinarity, the talent of its members, and the emergence of challenging ideas are considered to promote creativity and innovation [63].

*Curiosity* references the ability to perceive things in observed reality that others do not see. One pays special attention to sources of new opportunities. In order to obtain results in innovation, people must have innate curiosity, be open to experimentation [70], and have a healthy dose of alertness [79]. It merits mention that this feature joins three elements of the so-called innovator DNA: ask, observe, and experiment [80].

*Association* is the ability to connect successfully with that which is apparently disconnected, which requires the ability to transfer potential from one place to another [40]. Association is like a mental muscle which can grow stronger by using the other abilities that it discovers, as innovators practice the association, they build their ability to generate ideas that can be recombined in new ways [80]

*Respect* is seeing a person's value, recognizing their expertise and knowledge, and considering their human dignity. While this is a value more than a cultural trait as such, and the specialized literature has rarely noted it as a determining factor for innovation [81], our empirical investigative findings indicate that, in this context, respect is a nonnegotiable condition for the generation of trust and commitment.

### **4.3. Managing organization competencies**

The knowledge, beliefs, behavior, and attitudes of management at an organization do not solely exist as an aggregate of the individual characteristics of the members of the said team. They are also, essentially, the result of policies, everyday practices, intentional declarations, and reward systems which the organization uses on a daily basis.

In the present proposal, managing organization competencies have been termed, "the decisions that upper-level management make, which impact the total operation of the organizations they lead, and which maintain a close connection to the knowledge and beliefs cultivated" [82]. According to Barlett and Ghoshal [83], owing to the current global conditions and new organizational demands, business managers have had to exchange their central controlling role for one of employee development, such that employees become empowered and autonomous, fundamental conditions for innovation.

The review of innovative culture literature enabled the selection of seven management competencies that are closely associated with innovation and creativity: communication, teamwork, tolerance for error, conflict management, decision-making, simplicity and agility, and prioritization.

*Effective communication* is the most widely recognized management competency in previous innovative culture investigations. In order for communication to stimulate innovation and creativity, it must be open and transparent; this promotes trust and transmits the idea that disagreement is acceptable within the organization [22].

seek agreement. When there is a conflict between the different ideas, perceptions, and ways in which one may process and evaluate information, the conflict should be managed construc-

*Acceptance of diversity* concerns the ability to interact with different people (from varying hierarchical levels, stages of knowledge, external areas, and interdisciplinary areas). Work teams characterized by diversity, interdisciplinarity, the talent of its members, and the emergence of

*Curiosity* references the ability to perceive things in observed reality that others do not see. One pays special attention to sources of new opportunities. In order to obtain results in innovation, people must have innate curiosity, be open to experimentation [70], and have a healthy dose of alertness [79]. It merits mention that this feature joins three elements of the

*Association* is the ability to connect successfully with that which is apparently disconnected, which requires the ability to transfer potential from one place to another [40]. Association is like a mental muscle which can grow stronger by using the other abilities that it discovers, as innovators practice the association, they build their ability to generate ideas that can be

*Respect* is seeing a person's value, recognizing their expertise and knowledge, and considering their human dignity. While this is a value more than a cultural trait as such, and the specialized literature has rarely noted it as a determining factor for innovation [81], our empirical investigative findings indicate that, in this context, respect is a nonnegotiable condition for the

The knowledge, beliefs, behavior, and attitudes of management at an organization do not solely exist as an aggregate of the individual characteristics of the members of the said team. They are also, essentially, the result of policies, everyday practices, intentional declarations,

In the present proposal, managing organization competencies have been termed, "the decisions that upper-level management make, which impact the total operation of the organizations they lead, and which maintain a close connection to the knowledge and beliefs cultivated" [82]. According to Barlett and Ghoshal [83], owing to the current global conditions and new organizational demands, business managers have had to exchange their central controlling role for one of employee development, such that employees become empowered and

The review of innovative culture literature enabled the selection of seven management competencies that are closely associated with innovation and creativity: communication, teamwork, tolerance for error, conflict management, decision-making, simplicity and agility, and prioritization. *Effective communication* is the most widely recognized management competency in previous innovative culture investigations. In order for communication to stimulate innovation and

challenging ideas are considered to promote creativity and innovation [63].

tively, so as to promote creativity and innovation [22, 78].

so-called innovator DNA: ask, observe, and experiment [80].

and reward systems which the organization uses on a daily basis.

autonomous, fundamental conditions for innovation.

recombined in new ways [80]

22 Organizational Culture

generation of trust and commitment.

**4.3. Managing organization competencies**

It must facilitate the free exchange of ideas, promoting horizontal communication between individuals, as well as between teams and departments, as this removes bureaucratic procedures [84, 85]. However, additionally, it should share lessons learned from both success and failure, tell stories which inspire, or warn of possible failings [48].

Once the sensation of emotional security has been created, an employee may feel driven toward divergent thinking and discover new and creative possibilities, without fear of punishment [22]. This is achieved with open and unrestricted communication.

*Teamwork* is a critical competency used to both stimulate and support innovation [12], provided that empathy and trust are built, and the synergetic effect of participative and collective work is understood.

Multifunctional teams (R&D, design, engineering, sales) are more effective if they are additionally able to exchange ways of thinking and expertise [48] with an open mind, so as to work with a certain degree of uncertainty and conflict [9]. All teams must have the support of a leader and appropriate resource allocation.

According to Leifer et al. [86], team members who work on radical innovation processes should combine their technical abilities with curiosity, passion, flexibility, and ability to take risks.

*Tolerance for error* has to do with accepting a reasonable margin of error especially the one that is committed trying new things that generate learnings [65]. It values the assumption of risk; encourages taking significant, calculated risks within the scope of one's work; and encourages defiance of the status quo, in an effort to produce positive results. It promotes employee experimentation with new ideas and doing things differently, without fear of negative consequences to their self-image, status, or professional career [6]. Successful organizations not only reward success but also tolerate mistakes, in order to create opportunities for discussion and learning from mistakes [22].

When the organization permits a functional level of conflict, and when the management team is capable of *tolerating and constructively managing* conflict, innovative behavior is stimulated in organizations. This implies accepting different styles of thinking among the members of the organization but at the same time encouraging constructive confrontation between them [22].

On the other hand, participative *decision-making*, which involves others and offers freedom and empowerment to perform one's job and choose the procedures to be used abiding by a few minimal, predictable guidelines, is the source of creativity and innovation [22].

The complexity and dynamics of the global environmental demand that decision-making be quick and timely, in addition to being participative and efficient, which is characteristic of innovative organizations [30].

Another important management competency for innovation is *simplicity and agility* in organizational processes. Managers should eliminate the belief that if something is simple and quick, it cannot be appropriate for a world-class organization. Process perfectionism, sluggishness in decision-making, and excessive action sophistication are the enemies of innovation [40].

exploration to ensure future viability. In order to act in this ambiguity, the organization must

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*Capacity for client and market orientation*: understood as the capability to have one's eye on both the market and its players such as clients, competitors, suppliers, as well as the variables which determine the competitive context on social, political, geographical, technological, and economic levels [40]. This capability is considered to be fundamental, as in many cases, it is

If the company is isolated from the market, it will be incapable of discovering or capitalizing on the opportunities which exist beyond its centers of activity or beyond its current technical or operative capacity [40, 93]. A company which compares, analyzes, and responds to competitor movements may generate new solutions and improve the performance of new products [94]. *Capacity for speed*: this refers to the capability to develop and launch innovative products more quickly than the competition and is considered a key factor for the success of new products. Above all, it is considered a condition to capitalize on the early benefits of innovation [40, 95]. Because competition has intensified, product life cycles have been reduced, and product obsolescence now occurs more quickly. Companies are increasing their efforts to improve the product development cycle, deliver innovative products to the market quickly, and be the first to move in their industries, such that they can create relative advantages in market

participation and benefits and a competitive advantage in the long term [96, 97].

*Capacity for relationships*: this refers to an organization's ability to establish effective relationships between organizational players as well as those external to the organization. In the internal setting, the cross-functional information exchange between the main players in the development process offers multiple benefits: (1) the available knowledge base is broadened, which reduces uncertainty regarding future difficulties and opportunities, (2) product concept alignment with functional and corporate strategies is ensured, and (3) design phases can

Regarding external relationships, Olmos-Peñuela et al. [4] indicate that, given that academic and commercial activities have different objectives—those of the former center on ways to carry out rigorous investigations, and the latter seek commercial achievements—they require different skills and abilities. Although the differences may produce collaborative tension and difficulties, they can also amplify the learning possibilities, which aid to strengthen company

*Capacity for execution*: in the process of innovation development, this is associated with the ability to go from the initiation phase, in which ideas are generated, to an idea application or implementation phase [40]. This implies favoring characteristics like the initiative to mobilize resources, the ability to plan which concerns coordination and execution, and rationale; such decisions made are supported by the use of logical arguments and accurate information [67]. *Adaptive capacity* is defined as the combination of factors which permit a company to learn and adapt nimbly to a changing environment and even allow for the prediction of the said changes [99]. Thus, the culture which most effects innovation is most highly adaptable [29].

possess certain features, including mental flexibility, trust, and acceptance of risk [40].

the source itself of innovation [91, 92].

occur in parallel [40, 98].

innovation culture [4].

One must remember that the time resource is costly, and not unlimited, especially in innovation processes. One must create a sense of urgency and pressure in innovation projects [9].

*Recognition and rigorousness* are the ways in which achievements are recognized, remunerated, and celebrated, in accordance with the level of rigorousness applied. Care should be taken with contradictions that could weaken these efforts. For example, if the rewards are structured for innovation but are given for the efficient performance of routine operations, it does not matter how alluring the other signals may be, and it is probable that employees will respond with caution and uncertainty [72].

Lastly, the ability to *prioritize* is key for innovation success. This requires the ability to balance the process-result relationship. In other words, the appropriate level of priority must be given to innovative processes, without sacrificing quality conditions. Stringer [87] found that radical innovation was only possible when it was prioritized in company culture and strategy.

This also means that the company must learn to make sacrifices and understand when to abandon projects, strategies, or actions. This is not an easy task, as many times the egos and interests of managers are entangled in these projects [65].

### **4.4. Organizational capabilities**

Organizational capability is the distinctive way in which a company combines resources, policies, routines, and processes to generate organizational results [88]. These are constructed from a continuous learning and as a result of the way in which each company solves its problems on a daily basis.

The social capability construction process requires companies to develop a number of specific cultural traits. This dimension, then, acts as an adjustment to those features generated by determinants of culture.

In a previous study [40], seven indispensable organizational capacities were identified for innovation: ambidexterity, customer and market orientation, speed, relationships, execution, adaptability, and entrepreneurial orientation.

*Capacity for ambidexterity*: a company is considered ambidextrous when it simultaneously develops exploration and exploitation competencies. Competence exploitation refers to a company's tendency to invest resources, in order to refine and extend its existing product innovation knowledge, skills, and processes, with the goal of increased efficiency and reliability in existing innovation activities. Competence exploration, conversely, refers to a company's tendency to invest resources so as to acquire entirely new knowledge, skills, and processes, aiming to attain flexibility and novelty in product innovation through increased variation and experimentation [89].

March [90] believes that an organization should agree upon a sufficient amount of exploitation, in order to ensure present viability, and simultaneously put sufficient energy into exploration to ensure future viability. In order to act in this ambiguity, the organization must possess certain features, including mental flexibility, trust, and acceptance of risk [40].

it cannot be appropriate for a world-class organization. Process perfectionism, sluggishness in decision-making, and excessive action sophistication are the enemies of innovation [40].

One must remember that the time resource is costly, and not unlimited, especially in innovation processes. One must create a sense of urgency and pressure in innovation projects [9].

*Recognition and rigorousness* are the ways in which achievements are recognized, remunerated, and celebrated, in accordance with the level of rigorousness applied. Care should be taken with contradictions that could weaken these efforts. For example, if the rewards are structured for innovation but are given for the efficient performance of routine operations, it does not matter how alluring the other signals may be, and it is probable that employees will

Lastly, the ability to *prioritize* is key for innovation success. This requires the ability to balance the process-result relationship. In other words, the appropriate level of priority must be given to innovative processes, without sacrificing quality conditions. Stringer [87] found that radical innovation was only possible when it was prioritized in company culture and strategy.

This also means that the company must learn to make sacrifices and understand when to abandon projects, strategies, or actions. This is not an easy task, as many times the egos and

Organizational capability is the distinctive way in which a company combines resources, policies, routines, and processes to generate organizational results [88]. These are constructed from a continuous learning and as a result of the way in which each company solves its prob-

The social capability construction process requires companies to develop a number of specific cultural traits. This dimension, then, acts as an adjustment to those features generated by

In a previous study [40], seven indispensable organizational capacities were identified for innovation: ambidexterity, customer and market orientation, speed, relationships, execution,

*Capacity for ambidexterity*: a company is considered ambidextrous when it simultaneously develops exploration and exploitation competencies. Competence exploitation refers to a company's tendency to invest resources, in order to refine and extend its existing product innovation knowledge, skills, and processes, with the goal of increased efficiency and reliability in existing innovation activities. Competence exploration, conversely, refers to a company's tendency to invest resources so as to acquire entirely new knowledge, skills, and processes, aiming to attain flexibility and novelty in product innovation through increased

March [90] believes that an organization should agree upon a sufficient amount of exploitation, in order to ensure present viability, and simultaneously put sufficient energy into

respond with caution and uncertainty [72].

**4.4. Organizational capabilities**

lems on a daily basis.

24 Organizational Culture

determinants of culture.

adaptability, and entrepreneurial orientation.

variation and experimentation [89].

interests of managers are entangled in these projects [65].

*Capacity for client and market orientation*: understood as the capability to have one's eye on both the market and its players such as clients, competitors, suppliers, as well as the variables which determine the competitive context on social, political, geographical, technological, and economic levels [40]. This capability is considered to be fundamental, as in many cases, it is the source itself of innovation [91, 92].

If the company is isolated from the market, it will be incapable of discovering or capitalizing on the opportunities which exist beyond its centers of activity or beyond its current technical or operative capacity [40, 93]. A company which compares, analyzes, and responds to competitor movements may generate new solutions and improve the performance of new products [94].

*Capacity for speed*: this refers to the capability to develop and launch innovative products more quickly than the competition and is considered a key factor for the success of new products. Above all, it is considered a condition to capitalize on the early benefits of innovation [40, 95].

Because competition has intensified, product life cycles have been reduced, and product obsolescence now occurs more quickly. Companies are increasing their efforts to improve the product development cycle, deliver innovative products to the market quickly, and be the first to move in their industries, such that they can create relative advantages in market participation and benefits and a competitive advantage in the long term [96, 97].

*Capacity for relationships*: this refers to an organization's ability to establish effective relationships between organizational players as well as those external to the organization. In the internal setting, the cross-functional information exchange between the main players in the development process offers multiple benefits: (1) the available knowledge base is broadened, which reduces uncertainty regarding future difficulties and opportunities, (2) product concept alignment with functional and corporate strategies is ensured, and (3) design phases can occur in parallel [40, 98].

Regarding external relationships, Olmos-Peñuela et al. [4] indicate that, given that academic and commercial activities have different objectives—those of the former center on ways to carry out rigorous investigations, and the latter seek commercial achievements—they require different skills and abilities. Although the differences may produce collaborative tension and difficulties, they can also amplify the learning possibilities, which aid to strengthen company innovation culture [4].

*Capacity for execution*: in the process of innovation development, this is associated with the ability to go from the initiation phase, in which ideas are generated, to an idea application or implementation phase [40]. This implies favoring characteristics like the initiative to mobilize resources, the ability to plan which concerns coordination and execution, and rationale; such decisions made are supported by the use of logical arguments and accurate information [67].

*Adaptive capacity* is defined as the combination of factors which permit a company to learn and adapt nimbly to a changing environment and even allow for the prediction of the said changes [99]. Thus, the culture which most effects innovation is most highly adaptable [29].

There are two key adaptive capacity components: the first component has to do with management team sensitivity to perceive existing tension between adaptive challenges and the possibility of internal adaptation. The second component has to do with the containing environment or the amount of help, support, and accompaniment available for adaptation [78].

The model designed in the present investigation systematically integrates four levels. Firstly, it integrates a group of factors called determinants of culture, owing to their strong impact on the generation of cultural traits. On the second level are the features and behaviors (traits) of an innovative culture which are parallel to two categories that act as adjustment mechanisms,

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On the third level are the behavioral roles derived from these cultural traits which define an organization's innovative behavior in its three components, idea generation, promotion, implementation. Lastly, the model registers the results expected from the innovative culture model, in terms of products and processes for technological innovation, as well as administrative and marketing processes, regardless of whether they are products of continuous

All of these components interact with each other, whether between dimensions and categories or there within, and this dynamic depends upon whether innovation and creativity in an

Although the proposed model is derived from previous qualitative and quantitative investigations, including from experience in the authors' organizational consultation, this study's lack of empirical contrasting is proposed as a limitation. As such, it constitutes a source of future applied investigations, so as to establish relationships between dimensions and catego-

For company decision-makers, the model constitutes an alternative to the performance of culture diagnostics and consequently enables them to formulate plans which close innovative

\* and Gregorio Calderon-Hernández2

[1] Naranjo-Valencia JC, Jimenez-Jimenez D, Sanz-Valle R. Studying the links between organizational culture, innovation, and performance in Spanish companies. Revista Latino-

[2] Crossan MM, Apaydin M. A multi-dimensional framework of organizational innovation: A systematic review of the literature. Journal of Management Studies. 2010;**47**(6):

americana de Psicología. 2016;**48**(1):30-41. DOI: 10.1016/j.rlp.2015.09.009

organizational capacities and management competencies.

ries, such as the moderating or mediating effects thereof.

\*Address all correspondence to: jcnaranjov@unal.edu.co 1 National University of Colombia, Manizales, Colombia

1154-1191. DOI: 10.1111/j.1467-6486.2009.00880.x

2 University of Manizales, Manizales, Colombia

improvement or disruptive innovation.

organization are supported or inhibited.

culture idea gaps.

**Author details**

**References**

Julia C. Naranjo-Valencia1

*Entrepreneurial orientation's* importance for innovation performance improvement has been indicated consistently in the literature. Entrepreneurial values improve the creation of new businesses within the existing company, as well as the renewal or rebirth of existing businesses that have become stagnant or require transformation [62].

Entrepreneurial orientation should be understood as a multidimensional concept that entails organizational actions related to the following dimensions: innovativeness, proactiveness, and risk-taking. Entrepreneurial orientation of a firm is demonstrated by the extent to which the top managers are inclined to take business-related risks (the risk-taking dimension), to favor change and innovation in order to obtain a competitive advantage for their firm (the innovation dimension), and to compete aggressively with other firms (the proactiveness dimension) [100, 101].

### **4.5. Behavioral roles**

Employee's innovative behavior has been defined from different perspectives, but, in general, it is linked to the different stages of the innovation process. From this perspective, innovative behavior is usually understood as individual actions directed toward the generation, introduction, and application of novel benefits on some organizational level [63, 102].

In accordance with Naranjo-Valencia (following Tushman and Nadler, 1986; Scott and Bruce, 1994; Sim et al., 2007; Martins et al., 2008; Wolfe, 1995; Kanter, 1988) [53, 63], each of the stages of innovative behavior corresponds to a behavioral role: in the first stage of the innovation process, the *inventor*, or idea generator role, is fundamental. In other words, this is the role of individuals who recognize a problem and generate new ideas or solutions and those who focus on scientific and technical invention prior to concept development. Thereafter, people are required for the role of product *champions*, who must promote these new ideas and garner support for them, both within and outside of the organization.

In the final stage of the innovation process, the *implementer* role is required. This is the role of those who try to facilitate an innovation's formal development by obtaining resources, organizing innovation execution, and assuring that each task and important activity are completed on time and within the budget.

### **5. Conclusions**

Innovation in organizations is imperative in a global world, with turbulent settings and ever more demanding markets. Innovation requires R&D investment as well as an organizational culture which stimulates and promotes it. The characteristics of a culture that encourages, and does not inhibit or restrict, innovation have been studied by various authors, but the diverse models proposed thereby possess limitations, in which the present investigation has attempted to redress.

The model designed in the present investigation systematically integrates four levels. Firstly, it integrates a group of factors called determinants of culture, owing to their strong impact on the generation of cultural traits. On the second level are the features and behaviors (traits) of an innovative culture which are parallel to two categories that act as adjustment mechanisms, organizational capacities and management competencies.

On the third level are the behavioral roles derived from these cultural traits which define an organization's innovative behavior in its three components, idea generation, promotion, implementation. Lastly, the model registers the results expected from the innovative culture model, in terms of products and processes for technological innovation, as well as administrative and marketing processes, regardless of whether they are products of continuous improvement or disruptive innovation.

All of these components interact with each other, whether between dimensions and categories or there within, and this dynamic depends upon whether innovation and creativity in an organization are supported or inhibited.

Although the proposed model is derived from previous qualitative and quantitative investigations, including from experience in the authors' organizational consultation, this study's lack of empirical contrasting is proposed as a limitation. As such, it constitutes a source of future applied investigations, so as to establish relationships between dimensions and categories, such as the moderating or mediating effects thereof.

For company decision-makers, the model constitutes an alternative to the performance of culture diagnostics and consequently enables them to formulate plans which close innovative culture idea gaps.

## **Author details**

There are two key adaptive capacity components: the first component has to do with management team sensitivity to perceive existing tension between adaptive challenges and the possibility of internal adaptation. The second component has to do with the containing environment or the amount of help, support, and accompaniment available for adaptation [78]. *Entrepreneurial orientation's* importance for innovation performance improvement has been indicated consistently in the literature. Entrepreneurial values improve the creation of new businesses within the existing company, as well as the renewal or rebirth of existing busi-

Entrepreneurial orientation should be understood as a multidimensional concept that entails organizational actions related to the following dimensions: innovativeness, proactiveness, and risk-taking. Entrepreneurial orientation of a firm is demonstrated by the extent to which the top managers are inclined to take business-related risks (the risk-taking dimension), to favor change and innovation in order to obtain a competitive advantage for their firm (the innovation dimension), and to compete aggressively with other firms (the proactiveness dimension) [100, 101].

Employee's innovative behavior has been defined from different perspectives, but, in general, it is linked to the different stages of the innovation process. From this perspective, innovative behavior is usually understood as individual actions directed toward the generation, intro-

In accordance with Naranjo-Valencia (following Tushman and Nadler, 1986; Scott and Bruce, 1994; Sim et al., 2007; Martins et al., 2008; Wolfe, 1995; Kanter, 1988) [53, 63], each of the stages of innovative behavior corresponds to a behavioral role: in the first stage of the innovation process, the *inventor*, or idea generator role, is fundamental. In other words, this is the role of individuals who recognize a problem and generate new ideas or solutions and those who focus on scientific and technical invention prior to concept development. Thereafter, people are required for the role of product *champions*, who must promote these new ideas and garner support for them, both

In the final stage of the innovation process, the *implementer* role is required. This is the role of those who try to facilitate an innovation's formal development by obtaining resources, organizing innovation execution, and assuring that each task and important activity are com-

Innovation in organizations is imperative in a global world, with turbulent settings and ever more demanding markets. Innovation requires R&D investment as well as an organizational culture which stimulates and promotes it. The characteristics of a culture that encourages, and does not inhibit or restrict, innovation have been studied by various authors, but the diverse models proposed thereby possess limitations, in which the present investigation has

duction, and application of novel benefits on some organizational level [63, 102].

nesses that have become stagnant or require transformation [62].

**4.5. Behavioral roles**

26 Organizational Culture

within and outside of the organization.

pleted on time and within the budget.

**5. Conclusions**

attempted to redress.

Julia C. Naranjo-Valencia1 \* and Gregorio Calderon-Hernández2

\*Address all correspondence to: jcnaranjov@unal.edu.co

1 National University of Colombia, Manizales, Colombia

2 University of Manizales, Manizales, Colombia

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**Chapter 3**

**Provisional chapter**

**The Role of National Cultures in Shaping the Corporate**

**The Role of National Cultures in Shaping the Corporate** 

This chapter explores answers to the question that how national cultures influence the management cultures of organizations. In this case, therefore, differences and similarities among the national cultures of Pakistan, Mexico, and the USA are under investigation in order to analyze the impacts of such differences and similarities on the management cultures of organizations located in these countries. The outcomes of the analysis based on the existing literature suggest that differences in national cultures greatly influence the way organizations are managed in these countries. These findings present cross-cultural management challenges for organizations working in these countries, especially when they want to build trilateral or bilateral business partnerships. This is in addition to the

**Keywords:** corporate culture, cross-cultural management, management style, national

The role of culture in influencing international business management practices and approaches is an undisputed fact [1, 2]. Studies have shown repeatedly that national cultural systems as well as individual cultures greatly affect the corporate cultural system [3, 4] in many ways. For example, national culture influences managerial decision-making, leadership styles, and human resource management practices [5, 6]. Similarly, national cultures affect managerial functions such as communication, motivation, organizational design, people's expectations of

fact that the USA and Mexico are geographically far from Pakistan.

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

© 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use,

distribution, and reproduction in any medium, provided the original work is properly cited.

DOI: 10.5772/intechopen.78051

**Management Cultures: A Three-Country Theoretical**

**Management Cultures: A Three-Country Theoretical** 

Mohammad Ayub Khan and Laurie Smith Law

Mohammad Ayub Khan and Laurie Smith Law

Additional information is available at the end of the chapter

Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.78051

culture, Pakistani national culture

**Abstract**

**1. Introduction**

**Analysis**

**Analysis**


#### **The Role of National Cultures in Shaping the Corporate Management Cultures: A Three-Country Theoretical Analysis The Role of National Cultures in Shaping the Corporate Management Cultures: A Three-Country Theoretical Analysis**

DOI: 10.5772/intechopen.78051

Mohammad Ayub Khan and Laurie Smith Law Mohammad Ayub Khan and Laurie Smith Law

Additional information is available at the end of the chapter Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.78051

#### **Abstract**

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34 Organizational Culture

This chapter explores answers to the question that how national cultures influence the management cultures of organizations. In this case, therefore, differences and similarities among the national cultures of Pakistan, Mexico, and the USA are under investigation in order to analyze the impacts of such differences and similarities on the management cultures of organizations located in these countries. The outcomes of the analysis based on the existing literature suggest that differences in national cultures greatly influence the way organizations are managed in these countries. These findings present cross-cultural management challenges for organizations working in these countries, especially when they want to build trilateral or bilateral business partnerships. This is in addition to the fact that the USA and Mexico are geographically far from Pakistan.

**Keywords:** corporate culture, cross-cultural management, management style, national culture, Pakistani national culture

### **1. Introduction**

The role of culture in influencing international business management practices and approaches is an undisputed fact [1, 2]. Studies have shown repeatedly that national cultural systems as well as individual cultures greatly affect the corporate cultural system [3, 4] in many ways. For example, national culture influences managerial decision-making, leadership styles, and human resource management practices [5, 6]. Similarly, national cultures affect managerial functions such as communication, motivation, organizational design, people's expectations of

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. © 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

work design, and reward systems [7]. Moreover, organizational polices (e.g., human resource polices) are influenced by various national institutions such as labor laws, educational and vocational training practices, and industrial standards and regulations [8]. In essence, culture organizes values into mental programs and the behavior of people within organizations is an enactment of such programs [9]. Organizations can be the same in such objective dimensions as physical plant, layout, or product, yet very different in the meanings, which the surrounding human cultures read into them [10]. Not only technologies and markets shape organizational culture, but by the cultural preferences of leaders and employees, national culture has a strong impact on people's interpretations, understandings, and assessment of those with whom they work. Cultural values are important for interpersonal trust, teamwork, and the role of women in the workplace, among other issues [11, 12]. Cultural differences play a significant role in the way people conduct their lives and behave on the job. Culture is the interactive aggregate of common characteristics that influence a human group's response to its environment [13]. Cultural differences, if not understood and appreciated well, can lead to failures in business and social life [14]. Several studies, for example, [15] are available on the importance of learning about national cultures and the impact of national cultures on the operations of organizations. However, there are no studies on the issue of organizational cultural differences and similarities between Mexico, Pakistan, and the USA. That being the case, there is a dearth of literature on this subject and this chapter attempts to address this issue. In particular, this chapter intends to answer the following questions:

nations, regions, or groups [17]. Culture encompasses values, which are shared between people within a particular social setup with specific nationality or country of origin [18]. "Culture is created, acquired, and/or learned, developed, and passed on by a group of people, consciously or unconsciously, to subsequent generations. It includes everything that a group thinks, says, does, and makes—its customs, ideas, mores, habits, traditions, language, and shared systems of attitudes and feelings—that help to create standards for people to coexist [19]." Culture is also considered as an independent environmental variable specific to one specific country [20]. Furthermore, "Culture is the programming of the mind, which distinguishes the members of one human group to another. Being more precise, culture is a pattern of basic assumptions invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration [9]." In essence, culture is embedded in everything what we do, what we have, and what we think. Culture is learned through membership in a group and is composed of set of values, assumptions, and beliefs and that influence the attitudes and behaviors of group members [14]. In fact, culture is a set of distinctive spiritual, material, intellectual, and emotional features of society or a social group; it encompasses art

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37

**Figure 1.** National cultures influence the management cultures of organizations.

and literature, lifestyles, ways of living, value systems, traditions, and beliefs [21].

The national cultural system is made of values, beliefs, and is the collective programming of mind [7]. The national cultural system is also defined as "a set of historically evolved, learned and shared values, attitudes and means. The term nation refers to culture, social, economic and political institutions influence how organizations are managed in different environments [16]." In order to analyze and understand national cultural systems, cultures are classified into different levels: individual; group; organizational; industrial, national, and geographic regions [14]. Cultures are also grouped based on inner elements (i.e., history, beliefs, values, and work view), cultural activities (i.e., roles, art, communication patterns, rules, customs, technology, and material culture), and cultural systems (i.e., religion, economic, law, education, social organization, family, health, and politics) [22–24]. Over the past several years, different authors (as shown in **Table 1**) have used different dimensions to analyze and classify national cultures systems.

Since in this chapter, some of the dimensions of national culture proposed by [9, 25] are being studied; therefore, the five dimensions of national cultures of [25] are briefly explained in the

**2.2. Understanding the national cultural system**

following:


### **2. Literature review**

In order to answer the questions above, this chapter (1) explains the national culture and its scope, (2) analyzes the cultures of Pakistan, Mexico, and the USA, (3) explains management culture of organizations, and (4) compares and contrasts the management cultures of organizations of Pakistan, Mexico, and the USA. In particular, the literature review focuses on the role of national cultural variables in influencing the management cultures of organizations as shown in **Figure 1**.

### **2.1. Culture: concept and scope**

The role of national cultures in shaping organizational work environment and other social institutions has been studied by several researchers in the field (i.e., [16]). Culture is all that what we share with other members of our nation, region, or group but not with members of other

work design, and reward systems [7]. Moreover, organizational polices (e.g., human resource polices) are influenced by various national institutions such as labor laws, educational and vocational training practices, and industrial standards and regulations [8]. In essence, culture organizes values into mental programs and the behavior of people within organizations is an enactment of such programs [9]. Organizations can be the same in such objective dimensions as physical plant, layout, or product, yet very different in the meanings, which the surrounding human cultures read into them [10]. Not only technologies and markets shape organizational culture, but by the cultural preferences of leaders and employees, national culture has a strong impact on people's interpretations, understandings, and assessment of those with whom they work. Cultural values are important for interpersonal trust, teamwork, and the role of women in the workplace, among other issues [11, 12]. Cultural differences play a significant role in the way people conduct their lives and behave on the job. Culture is the interactive aggregate of common characteristics that influence a human group's response to its environment [13]. Cultural differences, if not understood and appreciated well, can lead to failures in business and social life [14]. Several studies, for example, [15] are available on the importance of learning about national cultures and the impact of national cultures on the operations of organizations. However, there are no studies on the issue of organizational cultural differences and similarities between Mexico, Pakistan, and the USA. That being the case, there is a dearth of literature on this subject and this chapter attempts to address this

issue. In particular, this chapter intends to answer the following questions:

of the three countries under study?

**2. Literature review**

36 Organizational Culture

**2.1. Culture: concept and scope**

in **Figure 1**.

zations of Pakistan, Mexico, and the USA?

**1.** Are the national cultures of Pakistan, Mexico, and the USA same or different? **2.** How national cultures influence the management cultures of organizations?

**3.** Are there differences and similarities between the management cultures of organizations

**4.** What if there are differences and similarities between the management cultures of organi-

In order to answer the questions above, this chapter (1) explains the national culture and its scope, (2) analyzes the cultures of Pakistan, Mexico, and the USA, (3) explains management culture of organizations, and (4) compares and contrasts the management cultures of organizations of Pakistan, Mexico, and the USA. In particular, the literature review focuses on the role of national cultural variables in influencing the management cultures of organizations as shown

The role of national cultures in shaping organizational work environment and other social institutions has been studied by several researchers in the field (i.e., [16]). Culture is all that what we share with other members of our nation, region, or group but not with members of other



**Figure 1.** National cultures influence the management cultures of organizations.

nations, regions, or groups [17]. Culture encompasses values, which are shared between people within a particular social setup with specific nationality or country of origin [18]. "Culture is created, acquired, and/or learned, developed, and passed on by a group of people, consciously or unconsciously, to subsequent generations. It includes everything that a group thinks, says, does, and makes—its customs, ideas, mores, habits, traditions, language, and shared systems of attitudes and feelings—that help to create standards for people to coexist [19]." Culture is also considered as an independent environmental variable specific to one specific country [20]. Furthermore, "Culture is the programming of the mind, which distinguishes the members of one human group to another. Being more precise, culture is a pattern of basic assumptions invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration [9]." In essence, culture is embedded in everything what we do, what we have, and what we think. Culture is learned through membership in a group and is composed of set of values, assumptions, and beliefs and that influence the attitudes and behaviors of group members [14]. In fact, culture is a set of distinctive spiritual, material, intellectual, and emotional features of society or a social group; it encompasses art and literature, lifestyles, ways of living, value systems, traditions, and beliefs [21].

#### **2.2. Understanding the national cultural system**

The national cultural system is made of values, beliefs, and is the collective programming of mind [7]. The national cultural system is also defined as "a set of historically evolved, learned and shared values, attitudes and means. The term nation refers to culture, social, economic and political institutions influence how organizations are managed in different environments [16]." In order to analyze and understand national cultural systems, cultures are classified into different levels: individual; group; organizational; industrial, national, and geographic regions [14]. Cultures are also grouped based on inner elements (i.e., history, beliefs, values, and work view), cultural activities (i.e., roles, art, communication patterns, rules, customs, technology, and material culture), and cultural systems (i.e., religion, economic, law, education, social organization, family, health, and politics) [22–24]. Over the past several years, different authors (as shown in **Table 1**) have used different dimensions to analyze and classify national cultures systems.

Since in this chapter, some of the dimensions of national culture proposed by [9, 25] are being studied; therefore, the five dimensions of national cultures of [25] are briefly explained in the following:


instance. Notwithstanding, in this chapter, a few of these variables are being studied in order to compare and contrast the national cultural systems of the three countries under study.

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Religion plays the role of a foundation stone in every aspect of human life [27]. With regard to the role of religion in one's professional life, Weber [28] suggests that, for example, the Protestants work ethic promotes hard working, saving money, and managing time well and therefore, leisure activities (going to bar, nightclubs, gambling) are not well seen [29]. Furthermore, working is seen as a way to receive God's blessing and mercy and therefore, working is viewed as the most important obligation in one's life [28]. Work is believed to contribute to the overall well-being of the individual and society around [30]. The influence of religion is also found in building positive attitude toward work, organizational commitment, and job quality. Protestantism emphasizes hard work, individual achievement, and a sense that people can control their environment [30]. Similarly, the religion of Islam places great importance on the role of work and working in one's life. Time should not be wasted and planning is important to achieve good results. Islamic messages and guidance vehemently support contributing to the development of the world. In Islam, work is given special importance to the extent that it is considered as an act of worship itself [31, 32]. Therefore, Islam lays a lot of emphasis on work and the need for man to work in earning his livelihood so as to be independent, self-sufficient, and in order to uphold his dignity among his peers and in his community/society. Employees have to fulfill their jobs for the societal obligation with the purpose to seek pleasure of Allah. Muslim must perform his duty as a religious obligation, and motivational reward is not only linked with earthly reward but also awarded in the hereafter [32]. Employees must adhere to diligence and efficiency as well as fairness in preserving public interest. Religion is a system of common beliefs or attitudes concerning a being or a system of thought that people consider sacred, divine, or the highest truth. Religion also incorporates the moral codes, values, institutions, traditions, and rituals associated with this system. Religion influences culture and therefore business and consumer

Social organization is another key element of nation cultural system. Different cultures have different social systems or system to organize the society around family systems, neighborhood, ethnic groupings, and tribal systems for instances [33]. The social organization is also about how these variables (of social organizations within each cultural system) are defined and interpreted. For example, family may include your immediate or direct relatives including your wife/husband and children (which is also called a nuclear family system) in one culture; and your wife/husband, children, parents, uncles, cousins, etc., are in other cultures (which is considered extended or traditional family system). Whether nuclear or extended, the family is a social group characterized by common residence, economic cooperation, and reproduction [33]. Social organizations as a national cultural component also include aspects of ethnicities, classification based on economics, family trees, distribution of roles and responsibilities among gender (male and female), and social

*2.3.1. Religion*

behavior, in various ways [32].

hierarchies so and so forth [33].

*2.3.2. Social organization*


Most of the studies undertaken on differences in national cultures and the impact of such differences on organizations find national cultures having profound effects on leadership style, communication, motivation, organizational design, people expectations of work design, and rewards in organizations [7]. Though national and organizational cultures are different in that that national cultural differences reside mostly in values and less in practices, whereas organizational cultural differences reside in practices, less in value [13, 9, 26]; however, they are interdependent and by that it means that national cultures influence directly or indirectly organizational cultures and vice versa. The national cultural identity is considered fundamental for individual characteristics such as self-esteem, functional effectiveness, mental health, and quality of life [21] and thus having direct effects on the managerial styles within organizations.

#### **2.3. The national cultural variables**

The national cultural system is composed of diverse variables including language, religion, rules and regulations, political system, social organization, history, economy, technology, education, values, attitudes, customs, traditions, concept of time, music, art, and architecture, for


**Table 1.** Classification of national cultures.

instance. Notwithstanding, in this chapter, a few of these variables are being studied in order to compare and contrast the national cultural systems of the three countries under study.

#### *2.3.1. Religion*

**1.** Power distance: the degree of equality, or inequality between people in a society.

selves as individuals, as apart from their group.

pected, surprising, and unknown situations.

line work role model.

38 Organizational Culture

**2.3. The national cultural variables**

Kluckhohn and Strodtbeck

Trompenaars and Hampden-Turner (1997)

(1961)

**Authors/years National cultural dimensions**

relational.

egalitarianism.

**Table 1.** Classification of national cultures.

**2.** Individualism vs. collectivism: the degree to which people of a society understand them-

**3.** Masculinity vs. femininity: the degree the society reinforces or not the traditional mascu-

**4.** Uncertainty avoidance: the degree to which people in a society feel uncomfortable in unex-

**5.** Long-term vs. short-term orientation: the degree people attach importance to a future-

Most of the studies undertaken on differences in national cultures and the impact of such differences on organizations find national cultures having profound effects on leadership style, communication, motivation, organizational design, people expectations of work design, and rewards in organizations [7]. Though national and organizational cultures are different in that that national cultural differences reside mostly in values and less in practices, whereas organizational cultural differences reside in practices, less in value [13, 9, 26]; however, they are interdependent and by that it means that national cultures influence directly or indirectly organizational cultures and vice versa. The national cultural identity is considered fundamental for individual characteristics such as self-esteem, functional effectiveness, mental health, and quality of life [21] and thus having direct effects on the managerial styles within organizations.

The national cultural system is composed of diverse variables including language, religion, rules and regulations, political system, social organization, history, economy, technology, education, values, attitudes, customs, traditions, concept of time, music, art, and architecture, for

Parsons and Shills (1962) Affectivity-affective neutrality; self-orientation-collectivity-orientation; universalismparticularism; ascription-achievement; specificity-diffuseness.

Hofstede (1980, 2001) Power distance; individualism/collectivism; masculinity/femininity; uncertainty

Schwartz (1992, 1999) Conservatism vs. autonomy; hierarchy vs. egalitarianism; mastery vs. harmony.

House et al. (2004) Power distance; uncertainty avoidance; assertiveness; institutional collectivism; in-group

avoidance; long term/short term.

internal direction vs. outer direction.

Human nature orientation; man-nature orientation; time orientation; activity orientation;

Universalism vs. particularism; individualism vs. communitarianism; specific vs. diffuse; neutral vs. emotional; achievement vs. ascription; sequential time vs. synchronous time;

collectivism; future orientation; performance orientation humane orientation; gender

oriented way of thinking rather than to a short-term oriented one.

Religion plays the role of a foundation stone in every aspect of human life [27]. With regard to the role of religion in one's professional life, Weber [28] suggests that, for example, the Protestants work ethic promotes hard working, saving money, and managing time well and therefore, leisure activities (going to bar, nightclubs, gambling) are not well seen [29]. Furthermore, working is seen as a way to receive God's blessing and mercy and therefore, working is viewed as the most important obligation in one's life [28]. Work is believed to contribute to the overall well-being of the individual and society around [30]. The influence of religion is also found in building positive attitude toward work, organizational commitment, and job quality. Protestantism emphasizes hard work, individual achievement, and a sense that people can control their environment [30]. Similarly, the religion of Islam places great importance on the role of work and working in one's life. Time should not be wasted and planning is important to achieve good results. Islamic messages and guidance vehemently support contributing to the development of the world. In Islam, work is given special importance to the extent that it is considered as an act of worship itself [31, 32]. Therefore, Islam lays a lot of emphasis on work and the need for man to work in earning his livelihood so as to be independent, self-sufficient, and in order to uphold his dignity among his peers and in his community/society. Employees have to fulfill their jobs for the societal obligation with the purpose to seek pleasure of Allah. Muslim must perform his duty as a religious obligation, and motivational reward is not only linked with earthly reward but also awarded in the hereafter [32]. Employees must adhere to diligence and efficiency as well as fairness in preserving public interest. Religion is a system of common beliefs or attitudes concerning a being or a system of thought that people consider sacred, divine, or the highest truth. Religion also incorporates the moral codes, values, institutions, traditions, and rituals associated with this system. Religion influences culture and therefore business and consumer behavior, in various ways [32].

#### *2.3.2. Social organization*

Social organization is another key element of nation cultural system. Different cultures have different social systems or system to organize the society around family systems, neighborhood, ethnic groupings, and tribal systems for instances [33]. The social organization is also about how these variables (of social organizations within each cultural system) are defined and interpreted. For example, family may include your immediate or direct relatives including your wife/husband and children (which is also called a nuclear family system) in one culture; and your wife/husband, children, parents, uncles, cousins, etc., are in other cultures (which is considered extended or traditional family system). Whether nuclear or extended, the family is a social group characterized by common residence, economic cooperation, and reproduction [33]. Social organizations as a national cultural component also include aspects of ethnicities, classification based on economics, family trees, distribution of roles and responsibilities among gender (male and female), and social hierarchies so and so forth [33].

#### *2.3.3. Language*

The role of language as a national cultural component is undebatable in the field of international business and management. It is not only important for business or management communication but also and most importantly, it shows the insight of a culture. Learning the language of the host country helps understanding the cultural sensitivities of the local employees and managers [34]. Language has both verbal (words) and nonverbal (facial expressions and gestures) characteristics. Languages are also classified as high and low context [34]. The low-context languagespeakers focus on the words, message, and the content when communicating, whereas the high-context language-speakers focus more on the context, surroundings, and how the words are communicated. The low-context language-speakers tend to depend on the clarity of the message, written documents, preciseness, and information-rich document. As a result, speakers must rely more heavily on providing greater message clarity, as well as other guarantees like written documents and information-rich advertising. High-context communicators generally look for long-term personal relationships, mutual trust, and personal prestige [35]. In high-context communication, the message cannot be understood without a great deal of background information. Low-context communication spells out more of the information explicitly in the message [34]. In low-context cultures, context is less important; most information is explicitly spelled out [35]. The role of language is fundamental for conversations, establishing and managing interpersonal affairs, managing organizations beyond the national borders, and leading multinational agreements and relationships [36]. Our histories, traditions, knowledge are preserved and disseminated through language. Language and linguistic structures are culture-centered which means while the culture supplies the meaning and meaning-making mechanisms, language in itself provides the symbols to support the delivery of such meanings to the intended audience or target [36]. In nutshell, language reflects the culture in that it presents ideas, thoughts, and artifacts and is a channel of sharing information, knowledge, values, experiences, and thoughts [36].

include distribution of knowledge, wealth, resource, information, authority, and the relationship between the boss and subordinates. In low-power distance societies, individuals feel equal to their peers (especially to superiors or subordinates). In high-power distance societies,

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This cultural dimension measures the degree of how much individuals in a particular society care about themselves vs. care about others. Individualistic societies tend to be more self-oriented where individual performance leads to individual outcomes. Individual independency and interests are protected and promoted. In contrast, collectivist cultures are group-oriented where interdependency and group interests override individual interests. Individuals are accountable to social norms and individual performance is measured by social standards [17].

This dimension measures the degree of how much (high/low) individuals in a particular culture are motivated by competition, personal achievement, and success. Individuals in masculine societies tend to prefer individual competition, achievement, and success, whereas individuals in feminine societies tend to care for others and want quality life for all [13].

This dimension of national culture measures the degree of how much individuals in a particular society risk when making decisions or taking action in an uncertain situation. Individuals from societies where uncertainty avoidance is high are considered not adventurous and risktakers in decision-making. Such individuals may need more time, information, planning, and support before they make any decisions about the future. Contrastingly, individuals from societies where uncertainty avoidance is low tend to be high-risk-takers when making deci-

The national culture of Pakistan is described as collectivist, status-conscious, and having a large power distance [39]. The social setup is family-centered and life is built within a group [40]. People keep a strong need for security and disapprove of independence in decisionmaking and questioning authority [41]. In general, a business culture in Pakistan is based on personal relationship and business is conducted among friends. If the business is negotiated between two Pakistani companies, many interpersonal negotiations have already been conducted in a social setting before the question enters the boardroom. The eldest, the head of the concern, will make his decision with or without you though he will politely listen to your views [42]. If the business is conducted with a foreign company, a lot of lobbying has to be done already before actually negotiating the issue. Friendship has to be formed and confidence built. The formal meetings are only held for formalize the deal [41]. The British influence on Pakistani culture is believed to have created social class system notably feudal

individuals feel unequal to their peers (superiors or subordinates) [13].

*2.3.6. Individualism vs. collectivism*

*2.3.7. Masculinity vs. femininity*

*2.3.8. High vs. low uncertainty avoidance*

**2.4. Pakistani, Mexican, and US national culture**

sions about the future [17].

*2.4.1. Pakistan national culture*

#### *2.3.4. Time concept*

This element of the national cultural system describes that how individuals in a particular cultural group approach to manage time. Time concept includes feeling, perception, and use of time. Either the nature or individuals control time. Time is money and thus can be wasted and invested. In cultures where time is perceived as controllable factor, people tend to be punctual, agendaoriented, and monochromic. Business practices such as schedules, planning, appointments for meetings, and taking responsibility for late delivery of products and services are parts and parcels of the corporate management culture. In cultures where time is considered as something to do with the nature or environment, people tend to be less punctual and polychromic [37]. In essence, the way people perceive the time factor will influence the way individuals control their time. In monochromic time-oriented cultures, individual employees establish goals and plan accordingly in order to increase job performance and job satisfaction. Time management influences every aspect of an individual's life including work life, family life, social and private life [38].

#### *2.3.5. High vs. low power distance*

This national cultural dimension measures the degree of acceptance or rejection of the unequal distribution of power and influence in organizations. The power and influence include distribution of knowledge, wealth, resource, information, authority, and the relationship between the boss and subordinates. In low-power distance societies, individuals feel equal to their peers (especially to superiors or subordinates). In high-power distance societies, individuals feel unequal to their peers (superiors or subordinates) [13].

#### *2.3.6. Individualism vs. collectivism*

*2.3.3. Language*

40 Organizational Culture

*2.3.4. Time concept*

*2.3.5. High vs. low power distance*

The role of language as a national cultural component is undebatable in the field of international business and management. It is not only important for business or management communication but also and most importantly, it shows the insight of a culture. Learning the language of the host country helps understanding the cultural sensitivities of the local employees and managers [34]. Language has both verbal (words) and nonverbal (facial expressions and gestures) characteristics. Languages are also classified as high and low context [34]. The low-context languagespeakers focus on the words, message, and the content when communicating, whereas the high-context language-speakers focus more on the context, surroundings, and how the words are communicated. The low-context language-speakers tend to depend on the clarity of the message, written documents, preciseness, and information-rich document. As a result, speakers must rely more heavily on providing greater message clarity, as well as other guarantees like written documents and information-rich advertising. High-context communicators generally look for long-term personal relationships, mutual trust, and personal prestige [35]. In high-context communication, the message cannot be understood without a great deal of background information. Low-context communication spells out more of the information explicitly in the message [34]. In low-context cultures, context is less important; most information is explicitly spelled out [35]. The role of language is fundamental for conversations, establishing and managing interpersonal affairs, managing organizations beyond the national borders, and leading multinational agreements and relationships [36]. Our histories, traditions, knowledge are preserved and disseminated through language. Language and linguistic structures are culture-centered which means while the culture supplies the meaning and meaning-making mechanisms, language in itself provides the symbols to support the delivery of such meanings to the intended audience or target [36]. In nutshell, language reflects the culture in that it presents ideas, thoughts, and artifacts and is a channel of sharing information, knowledge, values, experiences, and thoughts [36].

This element of the national cultural system describes that how individuals in a particular cultural group approach to manage time. Time concept includes feeling, perception, and use of time. Either the nature or individuals control time. Time is money and thus can be wasted and invested. In cultures where time is perceived as controllable factor, people tend to be punctual, agendaoriented, and monochromic. Business practices such as schedules, planning, appointments for meetings, and taking responsibility for late delivery of products and services are parts and parcels of the corporate management culture. In cultures where time is considered as something to do with the nature or environment, people tend to be less punctual and polychromic [37]. In essence, the way people perceive the time factor will influence the way individuals control their time. In monochromic time-oriented cultures, individual employees establish goals and plan accordingly in order to increase job performance and job satisfaction. Time management influences every

aspect of an individual's life including work life, family life, social and private life [38].

This national cultural dimension measures the degree of acceptance or rejection of the unequal distribution of power and influence in organizations. The power and influence This cultural dimension measures the degree of how much individuals in a particular society care about themselves vs. care about others. Individualistic societies tend to be more self-oriented where individual performance leads to individual outcomes. Individual independency and interests are protected and promoted. In contrast, collectivist cultures are group-oriented where interdependency and group interests override individual interests. Individuals are accountable to social norms and individual performance is measured by social standards [17].

#### *2.3.7. Masculinity vs. femininity*

This dimension measures the degree of how much (high/low) individuals in a particular culture are motivated by competition, personal achievement, and success. Individuals in masculine societies tend to prefer individual competition, achievement, and success, whereas individuals in feminine societies tend to care for others and want quality life for all [13].

#### *2.3.8. High vs. low uncertainty avoidance*

This dimension of national culture measures the degree of how much individuals in a particular society risk when making decisions or taking action in an uncertain situation. Individuals from societies where uncertainty avoidance is high are considered not adventurous and risktakers in decision-making. Such individuals may need more time, information, planning, and support before they make any decisions about the future. Contrastingly, individuals from societies where uncertainty avoidance is low tend to be high-risk-takers when making decisions about the future [17].

#### **2.4. Pakistani, Mexican, and US national culture**

#### *2.4.1. Pakistan national culture*

The national culture of Pakistan is described as collectivist, status-conscious, and having a large power distance [39]. The social setup is family-centered and life is built within a group [40]. People keep a strong need for security and disapprove of independence in decisionmaking and questioning authority [41]. In general, a business culture in Pakistan is based on personal relationship and business is conducted among friends. If the business is negotiated between two Pakistani companies, many interpersonal negotiations have already been conducted in a social setting before the question enters the boardroom. The eldest, the head of the concern, will make his decision with or without you though he will politely listen to your views [42]. If the business is conducted with a foreign company, a lot of lobbying has to be done already before actually negotiating the issue. Friendship has to be formed and confidence built. The formal meetings are only held for formalize the deal [41]. The British influence on Pakistani culture is believed to have created social class system notably feudal and civil servants. The elite symbolize money, power, and status. The education system in Pakistan also requires surrendering to authority-personal initiatives, and originality and independence in decision-making are met with disapproval [15]. Pakistani managers tend to make decisions based on rational; they are dependent and try to avoid spontaneous decisionmaking, which characterizes them as high risk averse and favorites of high power balance between boss and subordinates [43]. Pakistani social infrastructure is built around joint family system [44] and organization cultures reflect bureaucratic structure, authoritarian management, and centralized decision-making styles. Decision relating to employee management such as promotion, pay increase, and training and development are made based on personal likes and dislikes. Managers and owners tend to focus on their own profit while ignoring the interests or welfare of the employees [44]. Pakistan is considered a collectivistic society where long-term commitment and loyalty are critically important as a member of society or an organization. When it comes to the issue of whether the Pakistani society is masculine or feminine, the general understanding supports the notion that Pakistani culture tends to be masculine than feminine. The Pakistani culture promotes uncertainty avoidance where managers in corporations follow rigid rules and regulations, planning, punctuality, and security [45, 46].

loyalty, social relationships, and group affiliations. A masculine society is where managers are expected to make decisions, to be decisive, and assertive. In addition, a high uncertainty avoiding culture where risks are not taken and managers would not make risky and adventurous decisions. Decisions require time, information, consultation, and approval from the

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The American national culture is recognized as being individualistic, freedom-oriented, and competitive [54]. Americans value equality, informality, and individual privacy. American people are generally hardworking, disciplined, action-, and achievement-oriented. They are also direct, assertive, and largely materialistic [54]. Personal progress, egalitarianism, and self-control are other values of American people [55] both in social and professional life. Individual responsibility, decisiveness, strong work ethic, and forceful determination to have success in life are fundamentals for the American people [56]. American people are generally future-oriented and tend to work hard to make future better and successful. Consumerism and materialism are accepted. The nature can be controlled and should be controlled by planning and controlling resources in order to serve better the humankind [57]. Time is key factor in success since time is money, time can be wasted and invested. Efficiency, skills, and logical approach to solving business problems are common characteristics or American business managers [57]. American people are highly task-oriented and profit-focused. Workers are viewed as hardworking individuals. They can make their own decisions and control their own lives and environment [57]. Americans accept changes and risks for the betterment of the self and the society at large. American culture is also viewed by external (non-American) observers as being selfish, greedy [57], aggressive, and arrogant. In general, in accordance with the Hofstede's dimensions of national cultures, Americans are found to be low in the power distance index; high individualistic; high in masculinity and low uncertainty avoiding.

**Table 2** provides an interesting comparison of the three countries based on the variables collected from the existing literatures. In Mexico, more than 90% of the population is Catholics and people practice religious functions with respect and punctuality. Similarly, in Pakistan where 97% of the population is Muslim and people are very religious. Both Catholic and Islam provide its believers with certainty (avoidance of uncertainty is high) and masculine values tend to prevail in Catholic and Islamic countries [13]. Social organization is centered in family where father and mother play important roles. Both Spanish (national language of Mexico) and Urdu (national language of Pakistan) are high-context languages, which means in both of these languages, indirectness, implicitness, and nonverbal language are high. When dealing with business contracts, Mexicans and Pakistanis view the business relationship as a longterm deal and tend to trust the person not the company. In terms of approach to time management such as deadlines, schedules, planning, and time controlling, both cultures have relaxed sense of time. Not because time is not important but because time controlling is not within the scope and authority of the man in these two cultures. Both Mexican and Pakistan societies

competent authorizes in the hierarchy.

**2.5. Comparative analysis of the three national cultures**

*2.4.3. The US national culture*

#### *2.4.2. Mexican national culture*

The Mexican national culture is characterized as paternalistic culture in which high power distance and group orientation are accepted and practiced. Mexican managers make most of the strategic decisions leaving little or no control for operational staff to make decisions [47]. Managers resolve conflicts, establish goals, and measure the outcomes using established standards and criteria but without involving employees or subordinates in the lower hierarchy [7]. Mexican companies are managed like family units in which the owners and managers (mostly managers are the owners) act like father figures for the general employees in expectation to gain respect and loyalty [7]. Studies (e.g., [48]) find that Mexicans tend to be high class-sensitive, fatalistic minded, and collectivist at the same time. Mexicans consider both religious values (majority are Roman Catholics) and spending good life essential in one's life. Mexicans work to live, spend time with friends, like hobbies and sports. Macho attitudes are prominently demonstrated by Mexican men [49]. As mentioned earlier, Mexican national culture is generally group-oriented. Individual members of the group, therefore, are expected to maintain group harmony and conform to social norms of the group. Strong interpersonal relationships and building trust are critically important for future business relationships. While doing business in Mexico, friendliness, goodwill, and respect are keys for the success in the long run. Mexicans do business with individuals not with companies, so the process of establishing business or working relationships may take time [50]. Making and maintaining friends whether social or professional are helpful in solving both social and business conflicts in Mexico. Family status, connections, and education are respected [51]. Other key personal features such as sincerity, integrity, charisma, and sociability are highly valuable. Communication is polite and diplomatic since confrontational and conflictive approaches to resolve differences are not functional [52]. Overall, according to Hofstede's dimensions of national cultures [53], Mexico is considered a hierarchical society where power, class, and status are recognized and valued. A collectivistic society is promoting long-term commitment, loyalty, social relationships, and group affiliations. A masculine society is where managers are expected to make decisions, to be decisive, and assertive. In addition, a high uncertainty avoiding culture where risks are not taken and managers would not make risky and adventurous decisions. Decisions require time, information, consultation, and approval from the competent authorizes in the hierarchy.

### *2.4.3. The US national culture*

and civil servants. The elite symbolize money, power, and status. The education system in Pakistan also requires surrendering to authority-personal initiatives, and originality and independence in decision-making are met with disapproval [15]. Pakistani managers tend to make decisions based on rational; they are dependent and try to avoid spontaneous decisionmaking, which characterizes them as high risk averse and favorites of high power balance between boss and subordinates [43]. Pakistani social infrastructure is built around joint family system [44] and organization cultures reflect bureaucratic structure, authoritarian management, and centralized decision-making styles. Decision relating to employee management such as promotion, pay increase, and training and development are made based on personal likes and dislikes. Managers and owners tend to focus on their own profit while ignoring the interests or welfare of the employees [44]. Pakistan is considered a collectivistic society where long-term commitment and loyalty are critically important as a member of society or an organization. When it comes to the issue of whether the Pakistani society is masculine or feminine, the general understanding supports the notion that Pakistani culture tends to be masculine than feminine. The Pakistani culture promotes uncertainty avoidance where managers in corporations follow rigid rules and regulations, planning, punctuality, and security [45, 46].

The Mexican national culture is characterized as paternalistic culture in which high power distance and group orientation are accepted and practiced. Mexican managers make most of the strategic decisions leaving little or no control for operational staff to make decisions [47]. Managers resolve conflicts, establish goals, and measure the outcomes using established standards and criteria but without involving employees or subordinates in the lower hierarchy [7]. Mexican companies are managed like family units in which the owners and managers (mostly managers are the owners) act like father figures for the general employees in expectation to gain respect and loyalty [7]. Studies (e.g., [48]) find that Mexicans tend to be high class-sensitive, fatalistic minded, and collectivist at the same time. Mexicans consider both religious values (majority are Roman Catholics) and spending good life essential in one's life. Mexicans work to live, spend time with friends, like hobbies and sports. Macho attitudes are prominently demonstrated by Mexican men [49]. As mentioned earlier, Mexican national culture is generally group-oriented. Individual members of the group, therefore, are expected to maintain group harmony and conform to social norms of the group. Strong interpersonal relationships and building trust are critically important for future business relationships. While doing business in Mexico, friendliness, goodwill, and respect are keys for the success in the long run. Mexicans do business with individuals not with companies, so the process of establishing business or working relationships may take time [50]. Making and maintaining friends whether social or professional are helpful in solving both social and business conflicts in Mexico. Family status, connections, and education are respected [51]. Other key personal features such as sincerity, integrity, charisma, and sociability are highly valuable. Communication is polite and diplomatic since confrontational and conflictive approaches to resolve differences are not functional [52]. Overall, according to Hofstede's dimensions of national cultures [53], Mexico is considered a hierarchical society where power, class, and status are recognized and valued. A collectivistic society is promoting long-term commitment,

*2.4.2. Mexican national culture*

42 Organizational Culture

The American national culture is recognized as being individualistic, freedom-oriented, and competitive [54]. Americans value equality, informality, and individual privacy. American people are generally hardworking, disciplined, action-, and achievement-oriented. They are also direct, assertive, and largely materialistic [54]. Personal progress, egalitarianism, and self-control are other values of American people [55] both in social and professional life. Individual responsibility, decisiveness, strong work ethic, and forceful determination to have success in life are fundamentals for the American people [56]. American people are generally future-oriented and tend to work hard to make future better and successful. Consumerism and materialism are accepted. The nature can be controlled and should be controlled by planning and controlling resources in order to serve better the humankind [57]. Time is key factor in success since time is money, time can be wasted and invested. Efficiency, skills, and logical approach to solving business problems are common characteristics or American business managers [57]. American people are highly task-oriented and profit-focused. Workers are viewed as hardworking individuals. They can make their own decisions and control their own lives and environment [57]. Americans accept changes and risks for the betterment of the self and the society at large. American culture is also viewed by external (non-American) observers as being selfish, greedy [57], aggressive, and arrogant. In general, in accordance with the Hofstede's dimensions of national cultures, Americans are found to be low in the power distance index; high individualistic; high in masculinity and low uncertainty avoiding.

#### **2.5. Comparative analysis of the three national cultures**

**Table 2** provides an interesting comparison of the three countries based on the variables collected from the existing literatures. In Mexico, more than 90% of the population is Catholics and people practice religious functions with respect and punctuality. Similarly, in Pakistan where 97% of the population is Muslim and people are very religious. Both Catholic and Islam provide its believers with certainty (avoidance of uncertainty is high) and masculine values tend to prevail in Catholic and Islamic countries [13]. Social organization is centered in family where father and mother play important roles. Both Spanish (national language of Mexico) and Urdu (national language of Pakistan) are high-context languages, which means in both of these languages, indirectness, implicitness, and nonverbal language are high. When dealing with business contracts, Mexicans and Pakistanis view the business relationship as a longterm deal and tend to trust the person not the company. In terms of approach to time management such as deadlines, schedules, planning, and time controlling, both cultures have relaxed sense of time. Not because time is not important but because time controlling is not within the scope and authority of the man in these two cultures. Both Mexican and Pakistan societies


setup where parents and children are the primary members of the family. The American language English is a low-context language when comparing with Urdu and Spanish [54, 60].

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Management is about getting things done through other people. Managers are responsible for making decisions, allocating resources, and directing the activities of others to attain goals. Corporations are business organizations, and management involves a process, culture, and people [17]. Though certain management methods and practices are replicable abroad, however, they should be adjusted considering specific cultural needs and peculiarities [61]. Therefore, business corporations entering into alliances with organizations beyond their national boarders need to understand the differences found in management practices across national cultures [17]. Various organizational variables such as values, norms, ethical codes, rules, and regulations, for example, influence one way or the other corporate management styles. And such variables vary across national cultures and they do influence managerial functions, roles, and responsibilities [62]. Management style is about how managers behave and function when dealing with employees inside the company. Management style is the set of principles by which managers capitalize on the abilities of their employees [63]. Some management cultures accept and promote a work culture where managers are responsible for organizing, planning, coordinating, decision-making, and they have the authority and control over organizational resources. Whereas, some other cultures emphasize upon the notion that employees should be treated well, managers should delegate authority and resources to their employees, and managers are coaches and mentors [64]. In summary, the organizational culture is composed of variables such as management style, decision-making process, staffing procedures, interpersonal trust and confidence, commitment, control, importance of relationship, teamwork, and role of nature [65]. Organizational culture also includes the power structure, organizational structure, functional policies, and management systems [65]. Organization culture is about the values, rules, practices, and norms through which organizations manage their business operations [66]. A strong and dynamic organizational cultural system is fundamental for the organizational competitive advantage, if such cultural system is learned, developed,

Given the fact that corporate management culture involves a set of diverse and complex variables, a few but key variables of corporate management cultures are briefly elaborated in the

Management style can be classified in two broader categories. Mangers can be autocratic and democratic. Autocratic managers do not delegate authority to their subordinates. They will make most of the strategic and operational decisions. They will also control assets and resources within their jurisdiction. On the other hand, democratic managers will actually delegate authority to their subordinates in terms of decision-making and

**2.6. Corporate management culture**

and shared across the global organizational system [29].

following section.

*2.6.1. General management style*

resource management [64].

**Table 2.** National cultures: Mexico, Pakistan, and the USA.

are collectivist societies where individuals belong to family, neighborhood, and the society at large [11]. Pakistani culture is considered a traditionalist culture where values reflect family, class, the past, and revealed truth. Leadership is autocratic, male head of family as model. Women's status is generally low and time urgency is unimportant [58]. In Mexican cultural system, one can find the same features of family, class, male head of the family (Machismo), and time urgency is unimportant. Traditional cultures are usually strong in uncertainty avoidance, high in power distance, and tend to associative thinking [58]. Similarly, both Mexican and Pakistani cultures are grouped as particularistic where good relations with family and friends are vital. Importance of interpersonal relationship is high, institutionalized obligations are to family and friends, main basis for rewarding employees is employee's personal situations and purpose of pay raise is to stimulate better performance. Rules and standards should be adjusted depending on the subordinate or situation [58]. In Mexican organizations as in Pakistan organizations, workers view conformity, respect, and personal loyalty to supervisors are important and should be rewarded. Honoring status is part of Mexican business rituals. Lewis [59] group India, Pakistan, Arab countries, and Latin American countries as multiactive which means impatient, emotional, unpunctual, people-oriented, talkative, seeks favors, and delegates to relations. Both Mexico and Pakistan are found to be in the group of high power index cultures. Such cultures accept inequality as the cultural norm and these cultures therefore are vertical. People respect hierarchy, authority, and formalized rituals [23].

Interestingly, Mexican and Pakistani national cultures are closely related to each other based on most of the cultural variables used in this study. However, the American culture is different from both of these countries except in the variable of masculinity vs. femininity. All three countries reflect masculine tendencies in their respective societies showing the impacts of globalization and corporate cultures on societies. American society tends to promote and appreciate individualism, high time orientation, equality, and risk-taking attitude. However, Christianity (various branches) has strong roots in America and so does the Protestant work ethics, American tends to separate religious beliefs from professional life and thus religious beliefs are very personal matters. Families in America are organized around nuclear family setup where parents and children are the primary members of the family. The American language English is a low-context language when comparing with Urdu and Spanish [54, 60].

#### **2.6. Corporate management culture**

are collectivist societies where individuals belong to family, neighborhood, and the society at large [11]. Pakistani culture is considered a traditionalist culture where values reflect family, class, the past, and revealed truth. Leadership is autocratic, male head of family as model. Women's status is generally low and time urgency is unimportant [58]. In Mexican cultural system, one can find the same features of family, class, male head of the family (Machismo), and time urgency is unimportant. Traditional cultures are usually strong in uncertainty avoidance, high in power distance, and tend to associative thinking [58]. Similarly, both Mexican and Pakistani cultures are grouped as particularistic where good relations with family and friends are vital. Importance of interpersonal relationship is high, institutionalized obligations are to family and friends, main basis for rewarding employees is employee's personal situations and purpose of pay raise is to stimulate better performance. Rules and standards should be adjusted depending on the subordinate or situation [58]. In Mexican organizations as in Pakistan organizations, workers view conformity, respect, and personal loyalty to supervisors are important and should be rewarded. Honoring status is part of Mexican business rituals. Lewis [59] group India, Pakistan, Arab countries, and Latin American countries as multiactive which means impatient, emotional, unpunctual, people-oriented, talkative, seeks favors, and delegates to relations. Both Mexico and Pakistan are found to be in the group of high power index cultures. Such cultures accept inequality as the cultural norm and these cultures there-

Collectivist Collectivist Individualistic

High uncertainty avoidance

Low uncertainty avoidance

**Variables Mexico Pakistan USA** Religion Catholics Muslims Protestants

Language Mid-high context High context Low Time concept Relative Relative Absolute

Masculinity vs. femininity Masculine Masculine Masculine

Individualism vs. collectivism

44 Organizational Culture

Uncertain avoidance High uncertainty

**Table 2.** National cultures: Mexico, Pakistan, and the USA.

avoidance

Social organization Extended family centered Extended family centered Nuclear family centered

High/low power distance High power distance High power distance Low power distance

fore are vertical. People respect hierarchy, authority, and formalized rituals [23].

Interestingly, Mexican and Pakistani national cultures are closely related to each other based on most of the cultural variables used in this study. However, the American culture is different from both of these countries except in the variable of masculinity vs. femininity. All three countries reflect masculine tendencies in their respective societies showing the impacts of globalization and corporate cultures on societies. American society tends to promote and appreciate individualism, high time orientation, equality, and risk-taking attitude. However, Christianity (various branches) has strong roots in America and so does the Protestant work ethics, American tends to separate religious beliefs from professional life and thus religious beliefs are very personal matters. Families in America are organized around nuclear family Management is about getting things done through other people. Managers are responsible for making decisions, allocating resources, and directing the activities of others to attain goals. Corporations are business organizations, and management involves a process, culture, and people [17]. Though certain management methods and practices are replicable abroad, however, they should be adjusted considering specific cultural needs and peculiarities [61]. Therefore, business corporations entering into alliances with organizations beyond their national boarders need to understand the differences found in management practices across national cultures [17]. Various organizational variables such as values, norms, ethical codes, rules, and regulations, for example, influence one way or the other corporate management styles. And such variables vary across national cultures and they do influence managerial functions, roles, and responsibilities [62]. Management style is about how managers behave and function when dealing with employees inside the company. Management style is the set of principles by which managers capitalize on the abilities of their employees [63]. Some management cultures accept and promote a work culture where managers are responsible for organizing, planning, coordinating, decision-making, and they have the authority and control over organizational resources. Whereas, some other cultures emphasize upon the notion that employees should be treated well, managers should delegate authority and resources to their employees, and managers are coaches and mentors [64]. In summary, the organizational culture is composed of variables such as management style, decision-making process, staffing procedures, interpersonal trust and confidence, commitment, control, importance of relationship, teamwork, and role of nature [65]. Organizational culture also includes the power structure, organizational structure, functional policies, and management systems [65]. Organization culture is about the values, rules, practices, and norms through which organizations manage their business operations [66]. A strong and dynamic organizational cultural system is fundamental for the organizational competitive advantage, if such cultural system is learned, developed, and shared across the global organizational system [29].

Given the fact that corporate management culture involves a set of diverse and complex variables, a few but key variables of corporate management cultures are briefly elaborated in the following section.

#### *2.6.1. General management style*

Management style can be classified in two broader categories. Mangers can be autocratic and democratic. Autocratic managers do not delegate authority to their subordinates. They will make most of the strategic and operational decisions. They will also control assets and resources within their jurisdiction. On the other hand, democratic managers will actually delegate authority to their subordinates in terms of decision-making and resource management [64].

#### *2.6.2. Decision-making process*

Decision of strategic and operational nature can be centralized vs. decentralized. In centralized decision-making setup, managers in charge will make all or most of the decisions and transfer those decisions down to the lower staff in the chain of command for implementation. Lower staff in the hierarchy will not have, therefore, options of giving opinion and questioning the decisions already made by the person in-charge of the department or company. In a decentralized decision-making system, decision-making process will involve individual concerns and participation. Virtually, everybody is consulted before the final decision is made. Of course, the final decision should be approved by the person in-charge. In contrast to the centralized decision-making system, in decentralized decision-making setup, decisions of operational nature can be made by the lower staff in the event of necessity and urgency [64].

*2.6.6. Employee motivation*

individual advancement [67].

go along with it [10].

tions operate [69].

*2.7.1. General management style*

*2.6.7. Role of religion in the workplace*

The term motivation refers to an individual's choice of behaviors and the impetus behind those behaviors [67]. Mangers are responsible to set up a situation in which individual desires to carry out certain activities that will lead to the achievement of organizational goal [67]. Existing research works suggest that motivation tools are more likely to be social, interpersonal, and spiritual [8]. Motivation is influenced by the context of an individual's personal work and personal life and that context is greatly influenced by cultural variables, which affect the attitudes and behaviors of individual and groups on the job [67]. Motivation is cultural. In some cultures, workers can be motivated by teamwork, the need for the job, relation with their peers, flexible work hours, and relaxed work standards. In other cultures, people will be motivated by personal goals, division of labor, specific rules, and opportunities for

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Natural environment has been at the center of discussion for researcher as source of human existence. Natural elements such as floods, winds, earthquakes, famine, cold, fire, and so and so forth have surrounded human being from the inception [10]. Societies conduct business with two major orientations of nature: either to control and subdue the nature by imposing will upon it or man is part of the nature and must go along with its laws, directions, and forces [10]. Who controls the nature? Some cultures believe that it is the man with knowledge and resources control the nature. It is just like that, what happens to me is because of my actions. Some other cultures believe that other forces other than man itself such as God control the nature. That is why man has no control over it and therefore, must

Several studies [62] undertaken to understand the relationship between corporate management and national cultures find that management practices and national cultures congruency lead to the better organizational performance. Similarly, Hofstede [13] proposed that each culture has a preferred coordination mechanism, implying that workers from each nation deliver a better performance if they use their own preferred management practices. Similarly, Newman and Nollen [68] find that business performance is better when management practices match with the national culture since national differences influence management styles [62]. Management styles are deeply influenced by the social culture in which the organiza-

In Mexico, managers are autocratic and paternalistic. Mexicans value status and accept hierarchy. Workers expect respectful recognition of their roles within the hierarchy. Employees hesitate to provide decision-making input or assume decision-making responsibilities and risks [70]. Generally, subordinates do not challenge a decision made by supervisor or superior. Pakistan culture is also autocratic and paternalistic [71]. In contrast, the American culture

**2.7. National and corporate management cultures: a comparative analysis**

#### *2.6.3. Staffing*

Staffing means hiring people in organizations. Some organizations in some cultures use criteria for staff selection such as academic preparation, experience, and other specialized skills. These selection criteria are called technical criteria. Contrastingly, in some other cultures, organizations use selection criteria such as affiliation of the person with the company, family, political connection, and age for staffing purposes. These criteria of staffing are considered staffing based on social characteristics [64].

### *2.6.4. Controlling*

The term controlling describes the process of regulating organizational activities so that actual performance conforms to expected organizational standards and goals [67]. Controlling is an ongoing management function requiring managers to set up systems and produce desired behavior to facilitate the achievement of the company's goals. Controlling employee behavior in the workplace could be exercises either by social actions or by technical means. Social actions include appreciating employee performance, showing concern the employee and his/her family, recognizing his/her efforts and developing personal rapport. Technical means of controlling employee behavior involve formal reporting relationship, budgeting, rewards and punishment, objectives achievement evaluation, and regular supervisor. Which of these controlling mechanisms is appropriate and effective in a particular situation is a cultural question [64].

#### *2.6.5. Time concept*

Time is a valuable and limited resource to saved, scheduled, and spent with precision. Deadlines and schedules have to be met. Some cultures view time based on religious beliefs and destiny [67]. Cultures, which consider time as an absolute concept, are called monochromic time-oriented cultures, and cultures where time is viewed as a relative concept are considered polychromic time-oriented cultures. Monochronics believe that accomplishments and tasks can be divided into segments and each segment should be performed at a time. Polychronics attempt to do a number of things simultaneously in a nonlinear sequence [22]. Time is increasingly viewed as a factor that organizations must manage. Our conception of time is strongly affected by culture because time is an idea rather an object [10].

#### *2.6.6. Employee motivation*

*2.6.2. Decision-making process*

46 Organizational Culture

*2.6.3. Staffing*

*2.6.4. Controlling*

*2.6.5. Time concept*

staffing based on social characteristics [64].

Decision of strategic and operational nature can be centralized vs. decentralized. In centralized decision-making setup, managers in charge will make all or most of the decisions and transfer those decisions down to the lower staff in the chain of command for implementation. Lower staff in the hierarchy will not have, therefore, options of giving opinion and questioning the decisions already made by the person in-charge of the department or company. In a decentralized decision-making system, decision-making process will involve individual concerns and participation. Virtually, everybody is consulted before the final decision is made. Of course, the final decision should be approved by the person in-charge. In contrast to the centralized decision-making system, in decentralized decision-making setup, decisions of operational nature can be made by the lower staff in the event of necessity and urgency [64].

Staffing means hiring people in organizations. Some organizations in some cultures use criteria for staff selection such as academic preparation, experience, and other specialized skills. These selection criteria are called technical criteria. Contrastingly, in some other cultures, organizations use selection criteria such as affiliation of the person with the company, family, political connection, and age for staffing purposes. These criteria of staffing are considered

The term controlling describes the process of regulating organizational activities so that actual performance conforms to expected organizational standards and goals [67]. Controlling is an ongoing management function requiring managers to set up systems and produce desired behavior to facilitate the achievement of the company's goals. Controlling employee behavior in the workplace could be exercises either by social actions or by technical means. Social actions include appreciating employee performance, showing concern the employee and his/her family, recognizing his/her efforts and developing personal rapport. Technical means of controlling employee behavior involve formal reporting relationship, budgeting, rewards and punishment, objectives achievement evaluation, and regular supervisor. Which of these controlling mechanisms is appropriate and effective in a particular situation is a cultural question [64].

Time is a valuable and limited resource to saved, scheduled, and spent with precision. Deadlines and schedules have to be met. Some cultures view time based on religious beliefs and destiny [67]. Cultures, which consider time as an absolute concept, are called monochromic time-oriented cultures, and cultures where time is viewed as a relative concept are considered polychromic time-oriented cultures. Monochronics believe that accomplishments and tasks can be divided into segments and each segment should be performed at a time. Polychronics attempt to do a number of things simultaneously in a nonlinear sequence [22]. Time is increasingly viewed as a factor that organizations must manage. Our conception of

time is strongly affected by culture because time is an idea rather an object [10].

The term motivation refers to an individual's choice of behaviors and the impetus behind those behaviors [67]. Mangers are responsible to set up a situation in which individual desires to carry out certain activities that will lead to the achievement of organizational goal [67]. Existing research works suggest that motivation tools are more likely to be social, interpersonal, and spiritual [8]. Motivation is influenced by the context of an individual's personal work and personal life and that context is greatly influenced by cultural variables, which affect the attitudes and behaviors of individual and groups on the job [67]. Motivation is cultural. In some cultures, workers can be motivated by teamwork, the need for the job, relation with their peers, flexible work hours, and relaxed work standards. In other cultures, people will be motivated by personal goals, division of labor, specific rules, and opportunities for individual advancement [67].

### *2.6.7. Role of religion in the workplace*

Natural environment has been at the center of discussion for researcher as source of human existence. Natural elements such as floods, winds, earthquakes, famine, cold, fire, and so and so forth have surrounded human being from the inception [10]. Societies conduct business with two major orientations of nature: either to control and subdue the nature by imposing will upon it or man is part of the nature and must go along with its laws, directions, and forces [10]. Who controls the nature? Some cultures believe that it is the man with knowledge and resources control the nature. It is just like that, what happens to me is because of my actions. Some other cultures believe that other forces other than man itself such as God control the nature. That is why man has no control over it and therefore, must go along with it [10].

### **2.7. National and corporate management cultures: a comparative analysis**

Several studies [62] undertaken to understand the relationship between corporate management and national cultures find that management practices and national cultures congruency lead to the better organizational performance. Similarly, Hofstede [13] proposed that each culture has a preferred coordination mechanism, implying that workers from each nation deliver a better performance if they use their own preferred management practices. Similarly, Newman and Nollen [68] find that business performance is better when management practices match with the national culture since national differences influence management styles [62]. Management styles are deeply influenced by the social culture in which the organizations operate [69].

#### *2.7.1. General management style*

In Mexico, managers are autocratic and paternalistic. Mexicans value status and accept hierarchy. Workers expect respectful recognition of their roles within the hierarchy. Employees hesitate to provide decision-making input or assume decision-making responsibilities and risks [70]. Generally, subordinates do not challenge a decision made by supervisor or superior. Pakistan culture is also autocratic and paternalistic [71]. In contrast, the American culture is characterized by short-term employment, individual decision-making, individual responsibility rapid evaluation and promotion, explicit, formalized control, specialized career paths, and segmented concern [72].

rather he will do it for personal relationship and maintain his image among the workers [48]. In American culture, control is accepted and practiced through procedures, standards, and other explicit and formalized control mechanisms such as management objectives and performance-based evaluation and promotions [72]. Mexicans tend to be comfortable with inequalities of authority, whereas Americans prefer sharing authority with peers and bosses

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Though, both in Mexico and in Pakistan, time is an uncontrollable factor, which is controlled by nature not by human being, however, because of the historical background (British legacy in Pakistan), Pakistani worker will tend to be on time always to the work. Junior workers will be expected to be on time to their offices. For an ordinary Pakistani, time has no concept and therefore, getting things done on time is quite impossible [41]. Managers may exercise flexibility in their time management. Assignments can be accomplished in the last minutes. Appointments may not be considered as commitments in some parts of the country [71]. Being late for an appointment shows that the person is a boss. His esteem rises. Yet, punctuality is expected of foreigners [41]. Since Pakistan has several subcultures, approach to time management may vary from state to state or even from city to city within a state. In Mexico, generally speaking, time is a relative concept and a Mexican worker cannot be expected always to be on time. American punctuality, time management, and planning are universally known and

appreciated. For Americans, time is money and time can be invested and wasted.

Both Mexico and Pakistan are developing economies where the importance monetary benefits to meet the basic needs is high. Therefore, job-related satisfaction is given priority over other human needs such affiliation and esteem. Though some findings suggest that motivation in Pakistan may require the provision of affiliative needs and social recognition, it can be associated with the type of profession [71]. In American culture, where masculinity, consumerism, and social class are based on ownership (money, properties), good salaries, and other tangible economic/financial benefits can be a good source of motivating and keeping employees

Islam as religion of the 95% of the population in Pakistan has a strong role in organizational culture in comparison with the Catholic influence in the Mexican organizational culture. Even though Mexicans are considered religious in belief and refer to God for everything they do in life as Muslims do, however, since the separation of church from the government, Mexicans are found to be relatively less conservative in practice. Any company in Pakistan whether of foreign origin or national has to allocate a prayer room where employee can say their prayers during office hours, extend lunch breaks for Friday prayers and shorter office hours during Ramadan, the month of fasting [45]. Such religious practices and rituals are very rare to found in companies located in Mexico regardless of their origin and nationalities. In the USA, people

in the workplace [74].

*2.7.5. Time management*

*2.7.6. Employee motivation*

*2.7.7. Role of religion in the workplace*

motivated.

#### *2.7.2. Decision-making process*

In Mexican companies, the authority to make decision lies with the top in the hierarchy. Decisions are centralized and undemocratic. Roles are clearly separated between boss and subordinate. The boss makes decision and the workers should support the decision without making judgment about the decision. Usually, managers will not delegate authority to their employees to make decision of their own. In addition, the authoritarian management style of the Mexican managers tends to discourage upward communication [48]. In Pakistani organizations, since managers are autocratic, decision-making process is controlled and centralized on the top. Decisions are generally made by the high-ups in the rank and transmitted down to the junior levels through hierarchical channel [71]. Rational and dependent decision-making are preferred styles of Pakistani managers [71]. Interesting to note that in both Pakistani and Mexican organizations, decisions even of important and strategic nature can be made orally and disseminated among the staff. On occasions, employees may be encouraged to contribute ideas and suggestions, but they will not be given authority to make decisions. Decision-making is centralized and the final decisions in both countries lie in the hands of the mangers in top positions. The American culture is characterized individual decision-making, individual responsibility, and managers delegate authority and responsibilities [72].

#### *2.7.3. Staffing*

In any organization and for any position, in Mexico and Pakistan, while hiring employees, nepotism and favoritism are generally practiced. In hiring, relationship and connection are decisive criteria than technical competences of the candidate. Since both in Mexico and Pakistan, loyalty to superior is important, such staffing custom helps hiring employees who can be trusted [71]. The American culture in which individual productivity and efficiency are the sources of organizational effectiveness, staff practices such as short-term employment, rapid evaluation and promotion, staffing mostly on academic backgrounds, specialization and experience, and specialized career paths [72]. When selecting among job applicants, Mexican employers typically look for a work history that demonstrates ability to work harmoniously with others and to cooperate with authority. They also tend to seek workers who are agreeable, respectful, and obedient rather than innovative and independent [73].

#### *2.7.4. Control*

Mexican and Pakistan workers accept authority, power distance, and status and role identification [71]. Following instructions, rules and standards are minimal in both of these cultures. Mexican and Pakistani cultures resemble to each other though, however, Mexicans workers would prefer more social mechanisms (i.e., friendship, trust) to control them since they do not like formal (technical) controls (i.e., rules, standards). Mexican workers will usually do the work as favor not his or her duty as a job. He will feel less or no accountable to his job rather he will do it for personal relationship and maintain his image among the workers [48]. In American culture, control is accepted and practiced through procedures, standards, and other explicit and formalized control mechanisms such as management objectives and performance-based evaluation and promotions [72]. Mexicans tend to be comfortable with inequalities of authority, whereas Americans prefer sharing authority with peers and bosses in the workplace [74].

### *2.7.5. Time management*

is characterized by short-term employment, individual decision-making, individual responsibility rapid evaluation and promotion, explicit, formalized control, specialized career paths,

In Mexican companies, the authority to make decision lies with the top in the hierarchy. Decisions are centralized and undemocratic. Roles are clearly separated between boss and subordinate. The boss makes decision and the workers should support the decision without making judgment about the decision. Usually, managers will not delegate authority to their employees to make decision of their own. In addition, the authoritarian management style of the Mexican managers tends to discourage upward communication [48]. In Pakistani organizations, since managers are autocratic, decision-making process is controlled and centralized on the top. Decisions are generally made by the high-ups in the rank and transmitted down to the junior levels through hierarchical channel [71]. Rational and dependent decision-making are preferred styles of Pakistani managers [71]. Interesting to note that in both Pakistani and Mexican organizations, decisions even of important and strategic nature can be made orally and disseminated among the staff. On occasions, employees may be encouraged to contribute ideas and suggestions, but they will not be given authority to make decisions. Decision-making is centralized and the final decisions in both countries lie in the hands of the mangers in top positions. The American culture is characterized individual decision-making,

individual responsibility, and managers delegate authority and responsibilities [72].

are agreeable, respectful, and obedient rather than innovative and independent [73].

Mexican and Pakistan workers accept authority, power distance, and status and role identification [71]. Following instructions, rules and standards are minimal in both of these cultures. Mexican and Pakistani cultures resemble to each other though, however, Mexicans workers would prefer more social mechanisms (i.e., friendship, trust) to control them since they do not like formal (technical) controls (i.e., rules, standards). Mexican workers will usually do the work as favor not his or her duty as a job. He will feel less or no accountable to his job

In any organization and for any position, in Mexico and Pakistan, while hiring employees, nepotism and favoritism are generally practiced. In hiring, relationship and connection are decisive criteria than technical competences of the candidate. Since both in Mexico and Pakistan, loyalty to superior is important, such staffing custom helps hiring employees who can be trusted [71]. The American culture in which individual productivity and efficiency are the sources of organizational effectiveness, staff practices such as short-term employment, rapid evaluation and promotion, staffing mostly on academic backgrounds, specialization and experience, and specialized career paths [72]. When selecting among job applicants, Mexican employers typically look for a work history that demonstrates ability to work harmoniously with others and to cooperate with authority. They also tend to seek workers who

and segmented concern [72].

48 Organizational Culture

*2.7.2. Decision-making process*

*2.7.3. Staffing*

*2.7.4. Control*

Though, both in Mexico and in Pakistan, time is an uncontrollable factor, which is controlled by nature not by human being, however, because of the historical background (British legacy in Pakistan), Pakistani worker will tend to be on time always to the work. Junior workers will be expected to be on time to their offices. For an ordinary Pakistani, time has no concept and therefore, getting things done on time is quite impossible [41]. Managers may exercise flexibility in their time management. Assignments can be accomplished in the last minutes. Appointments may not be considered as commitments in some parts of the country [71]. Being late for an appointment shows that the person is a boss. His esteem rises. Yet, punctuality is expected of foreigners [41]. Since Pakistan has several subcultures, approach to time management may vary from state to state or even from city to city within a state. In Mexico, generally speaking, time is a relative concept and a Mexican worker cannot be expected always to be on time. American punctuality, time management, and planning are universally known and appreciated. For Americans, time is money and time can be invested and wasted.

### *2.7.6. Employee motivation*

Both Mexico and Pakistan are developing economies where the importance monetary benefits to meet the basic needs is high. Therefore, job-related satisfaction is given priority over other human needs such affiliation and esteem. Though some findings suggest that motivation in Pakistan may require the provision of affiliative needs and social recognition, it can be associated with the type of profession [71]. In American culture, where masculinity, consumerism, and social class are based on ownership (money, properties), good salaries, and other tangible economic/financial benefits can be a good source of motivating and keeping employees motivated.

### *2.7.7. Role of religion in the workplace*

Islam as religion of the 95% of the population in Pakistan has a strong role in organizational culture in comparison with the Catholic influence in the Mexican organizational culture. Even though Mexicans are considered religious in belief and refer to God for everything they do in life as Muslims do, however, since the separation of church from the government, Mexicans are found to be relatively less conservative in practice. Any company in Pakistan whether of foreign origin or national has to allocate a prayer room where employee can say their prayers during office hours, extend lunch breaks for Friday prayers and shorter office hours during Ramadan, the month of fasting [45]. Such religious practices and rituals are very rare to found in companies located in Mexico regardless of their origin and nationalities. In the USA, people


practices in American organizations. Employees are expected to be self-reliant. The system of hiring, promoting, and decision-making are based purely on merits and expertise. The American society is self-achievement and interpersonal competition driven. Americans live to work and therefore, monetary benefits and rewards leading to higher social status are successful motivation strategies in American companies. Americans like changes and accept new ideas and practices. The American society promotes self-sufficiency, independency, and individualism, which consequently influence the American companies to be less autocratic and more flexible with employees having control over operational-level decision-making and supervision [74].

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Pakistan organizations are typically authoritarian and decision-making is located at the top due to large power distance. Employee autonomy is limited, top-bottom communication is minimal and bottom-up communication is nonexistence [41]. Organizational structures are bureaucratic and not generally responsive to the needs of employees. Existing theories also suggest that creative management is limited by rigid rules and regulations and thus individual initiatives and contributions are nonexistence in Pakistan organizations whether they are public or private [77]. The Mexican society is family-oriented, hierarchical and therefore, social classes and unequal power distribution are accepted. Consequently, in Mexican organizations, authority is concentrated in the top management, no delegation of authority and decisions are centralized [78]. Both organizational culture in Mexico and Pakistan tend to be person-oriented [10] since in both countries authority is a figurehead, paternalistic, and powerful. Motivations are generally intrinsic, personal respect is important than monetary benefits. Otherwise, this culture is considered as a family culture where close-to-close but hierarchical relationship exists. This is in the sense that the father of a family has experience and authority greatly exceeding those of his children. This is power-oriented organizational culture in which the head is regarded as a caring father who knows better than his subordinates what should be done and what is good for them. In such organizational culture, the pressure is social and moral than financial or legal. In contrast to the both Pakistani and Mexican cultures, the American culture tends to be more transaction (job, task)oriented which leads to create organizational cultures of productivity, self-control, responsibility, and independency among the workers.

Overall, social organization (the importance of family), the spirituality (the importance of religion), and the external influence are relatively similar when comparing Mexico and Pakistan. However, the American reflects a clear distinction from Mexican and Pakistan cultures. Pakistani national culture is an amalgamation of Islamic religion, Indian origins, British inheritance, and American influence [45]. Similarly, Mexican national culture is a combination of the Catholic religion, Spanish heritage, American influence, and the indigenous origin. In general, both Mexican and Pakistani national value systems based on community, group life, strong need for dependency, respect for the authority, dominance of elite class in social and political life, culture of broken promises, and poor human development record. Both Pakistani and Mexican cultures are collectivist and high-power distance cultures [7]. According to Hofstede four national dimensions, Pakistan and Mexico are considerably similar to each other and are in the same group of countries with large power

In conclusion, commonness in the national value systems of Mexico and Pakistan, the two geographically distanced, but socioculturally close nations have a significant effect on the

distance-collectivist dimensions [13].

**Table 3.** Comparative analysis of management cultures: Pakistan, Mexico, and USA.

keep secular views of religion and being religious is something very personal. Having said that, the American Protestant work ethics, which promotes productivity, hard work, commitment, and good time management, has dominated the global work culture.

**Table 3** summarizes the differences and similarities among the corporate management cultures of the three countries under investigation:

### **3. Discussion and conclusion**

The three countries under analysis inherit rich and diverse cultural and historical backgrounds. America (USA) is considered a melting pot as a cultural system because of its cultural diversity and being an immigrant society. The historical influence of British, Spanish, and French cultures in combination with the mass mobilization of people from Asia, Africa, and Latin America has led to the conclusion that America's culture is everybody's culture [75]. The Mexican culture as well has passed through various deculturation and acculturation eras initiating with Aztecs and Mayan kings to the era of Spanish empire and French invasion. In spite of these historical events and occurrences, and the fact that America, the most influential nation in the world is its neighbor, Mexico has been able to keep its identity intact as a Latin American culture [76]. The Pakistani culture has seen even more complex and diverse intrusions in its history dated back to the invasion of Alexander the great; the Mongols, the Moghuls; the Persian; and the British a few to narrate. Since its arrival in early eighth century, Islam has been the dominant religion in the region (now Pakistan, India, and Bangladesh), but the influence of many other religions including Buddhism and Hinduism can be observed in some parts of Pakistan [41].

While comparing American, Mexican, and Pakistani national and corporate cultures, it is found that American organizations are well organized and hierarchies are established to facilitate the operations. Employee and manager relationships base on equality and achieving organizational objectives. Information sharing, consultation, and participating decision-making are common practices in American organizations. Employees are expected to be self-reliant. The system of hiring, promoting, and decision-making are based purely on merits and expertise. The American society is self-achievement and interpersonal competition driven. Americans live to work and therefore, monetary benefits and rewards leading to higher social status are successful motivation strategies in American companies. Americans like changes and accept new ideas and practices. The American society promotes self-sufficiency, independency, and individualism, which consequently influence the American companies to be less autocratic and more flexible with employees having control over operational-level decision-making and supervision [74].

**Variables Mexico Pakistan USA** Management style Autocratic and paternalistic Autocratic Pragmatic

> Centralized and individualized

Exists but not strong Very strong None existence

keep secular views of religion and being religious is something very personal. Having said that, the American Protestant work ethics, which promotes productivity, hard work, commit-

**Table 3** summarizes the differences and similarities among the corporate management cul-

The three countries under analysis inherit rich and diverse cultural and historical backgrounds. America (USA) is considered a melting pot as a cultural system because of its cultural diversity and being an immigrant society. The historical influence of British, Spanish, and French cultures in combination with the mass mobilization of people from Asia, Africa, and Latin America has led to the conclusion that America's culture is everybody's culture [75]. The Mexican culture as well has passed through various deculturation and acculturation eras initiating with Aztecs and Mayan kings to the era of Spanish empire and French invasion. In spite of these historical events and occurrences, and the fact that America, the most influential nation in the world is its neighbor, Mexico has been able to keep its identity intact as a Latin American culture [76]. The Pakistani culture has seen even more complex and diverse intrusions in its history dated back to the invasion of Alexander the great; the Mongols, the Moghuls; the Persian; and the British a few to narrate. Since its arrival in early eighth century, Islam has been the dominant religion in the region (now Pakistan, India, and Bangladesh), but the influence of many other religions including Buddhism and Hinduism can be observed in

While comparing American, Mexican, and Pakistani national and corporate cultures, it is found that American organizations are well organized and hierarchies are established to facilitate the operations. Employee and manager relationships base on equality and achieving organizational objectives. Information sharing, consultation, and participating decision-making are common

Social recognition and economic benefits

Staffing procedures Connections, references Connections, references Merit and achievement Control Social control is accepted Technical control is accepted Technical control is accepted Time management Less punctual Punctuality varies Punctuality at all cost

Consensual

recognition

Economic benefits and social

Centralized and individualized

economic benefits

tures of the three countries under investigation:

**3. Discussion and conclusion**

some parts of Pakistan [41].

**Table 3.** Comparative analysis of management cultures: Pakistan, Mexico, and USA.

ment, and good time management, has dominated the global work culture.

Motivation strategies Social recognition and

Decision-making process

50 Organizational Culture

Role of religion at workplace

Pakistan organizations are typically authoritarian and decision-making is located at the top due to large power distance. Employee autonomy is limited, top-bottom communication is minimal and bottom-up communication is nonexistence [41]. Organizational structures are bureaucratic and not generally responsive to the needs of employees. Existing theories also suggest that creative management is limited by rigid rules and regulations and thus individual initiatives and contributions are nonexistence in Pakistan organizations whether they are public or private [77]. The Mexican society is family-oriented, hierarchical and therefore, social classes and unequal power distribution are accepted. Consequently, in Mexican organizations, authority is concentrated in the top management, no delegation of authority and decisions are centralized [78]. Both organizational culture in Mexico and Pakistan tend to be person-oriented [10] since in both countries authority is a figurehead, paternalistic, and powerful. Motivations are generally intrinsic, personal respect is important than monetary benefits. Otherwise, this culture is considered as a family culture where close-to-close but hierarchical relationship exists. This is in the sense that the father of a family has experience and authority greatly exceeding those of his children. This is power-oriented organizational culture in which the head is regarded as a caring father who knows better than his subordinates what should be done and what is good for them. In such organizational culture, the pressure is social and moral than financial or legal. In contrast to the both Pakistani and Mexican cultures, the American culture tends to be more transaction (job, task)oriented which leads to create organizational cultures of productivity, self-control, responsibility, and independency among the workers.

Overall, social organization (the importance of family), the spirituality (the importance of religion), and the external influence are relatively similar when comparing Mexico and Pakistan. However, the American reflects a clear distinction from Mexican and Pakistan cultures. Pakistani national culture is an amalgamation of Islamic religion, Indian origins, British inheritance, and American influence [45]. Similarly, Mexican national culture is a combination of the Catholic religion, Spanish heritage, American influence, and the indigenous origin. In general, both Mexican and Pakistani national value systems based on community, group life, strong need for dependency, respect for the authority, dominance of elite class in social and political life, culture of broken promises, and poor human development record. Both Pakistani and Mexican cultures are collectivist and high-power distance cultures [7]. According to Hofstede four national dimensions, Pakistan and Mexico are considerably similar to each other and are in the same group of countries with large power distance-collectivist dimensions [13].

In conclusion, commonness in the national value systems of Mexico and Pakistan, the two geographically distanced, but socioculturally close nations have a significant effect on the value systems of the organizations. This presents several opportunities for the organizations in these two countries. Organizations in different sectors such as oil and gas, textile, education, consulting, research and development can make up strategic alliances to pursue international business ambitions. In addition, companies from Mexico can make direct invest in the Pakistani market and similarly companies from Pakistan can do business in Mexico without fearing of the cross-cultural constraints. Both Mexico and Pakistan are close strategic and business allies of the USA for a long time. Especially, Mexico as a NAFTA member nation depends for almost 80% of its international business/investments on the USA.

**5. Limitations in the study and future studies**

the information used in the study.

**Figure 2.** The role of moderating variables.

This analysis in this chapter is based on the conceptual analysis of the causal relationship between the national cultural variables and the corporate management culture variables. Such studies are considered research problem explorers and theory ground-breaker therefore, are viewed useful for further studies in the field. Exploratory studies such as this one establish the context for further quantitative analysis, identify needs for the research, broaden the knowledge of the researcher, and clarify the existing theories in the field of study [83]. However, such research endeavors are viewed descriptive, general and are criticized for not presenting field data, statistical analysis, and other quantitative procedures to establish the relationship among the research variables. Research quality can be influenced by the researcher personal experience, rigor is more difficult to achieve, and findings are difficult to understand [84]. Moreover, some researchers question the validity and reliability of the findings of such studies since the information is obtained through document analysis and secondary sources. This demands from the researcher to scrutinize and critically evaluate the source or the origin of

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53

Therefore, future studies in the field should consider several considerations. First, studies should only analyze the relationship whether correlations or causal relationships between the research variables, but also and most importantly to give weight to the moderating and mediating variables. **Figure 2** demonstrates that there several emerging variables (factors) that can have powerful moderating roles in establishing the relationship between the dependent (corporate management culture) and independent (national culture) variables in this study. For example, **Figure 2** suggests that variables such as information technologies, globalization, internationalization of HRM, business strategic alliances, workforce diversity, and regionalization may have moderating impacts on how national cultural variables can influence the corporate management cultures. In order to expand the research scope and strengthen the generalization of the results, a few more dependent variables (employee motivation, manage-

ment orientation, work ethics, and loyalty) could be added to the study and analysis.

### **4. Implications and recommendations**

The finding of this chapter presents implications for the corporate leaders in many ways: (1) Even though the Mexican and Pakistani cultures are found to have vivid similarities, these two nations are located far from each other geographically (the distance). Mexico is geographically close to the USA but culturally very far from it. Pakistan is far from the USA both geographically and culturally; (2) Spanish and Urdu languages are in the group of highcontext languages in the world of communication, but still Spanish and Urdu are different languages. Managers from both sides must learn the language in order to communicate and understand the culture. English is a low-context language, but it has become a generic and common business and management language globally. In spite of the fact that Catholicism and Islam share the same faith-roots, differences are huge between Mexican Catholics and Pakistani Muslims when it comes to the practice of religion and the importance given to the religion in one's daily life. Social organization is formed around extended family infrastructure in Pakistan as in Mexico, whereas the US social organization is much more decentralized to nuclear family establishment. Corporate leaders from the USA can have difficult time while working with employees from either Mexico or Pakistan. Other variables of power distance, uncertainty avoidance, collectivism/individualism, masculinity/femininity, and time concept used in this study and the effects of these variables on corporate management cultures suggest that Mexicans and Pakistanis tend to be more similar than different. Again, being Latin American vs. South Asian cultures, the realities on ground can present challenges for managers from both side.

Given all those implications described above, managers and investors from the three countries are advised to take national cultures as well as organizational culture into account when developing national and organizational business polices and standards. Managers and investors from these three countries are well aware of the fact that the world is becoming a global village and the need for cross-cultural learning is increasing with the growth of business organizations beyond their national boarder [79]. Individuals bring cultures of origin to work that reflect their particular ongoing histories in various cultural contexts, such as national culture [80]. In this manner, culture guides our choices, commitments, and standards of behavior [81]. Corporate managers are global and have to understand differences in global cultural system. They should be able to work on those differences and adopt managerial practices which are cultural sensitive and responsive [82].

## **5. Limitations in the study and future studies**

This analysis in this chapter is based on the conceptual analysis of the causal relationship between the national cultural variables and the corporate management culture variables. Such studies are considered research problem explorers and theory ground-breaker therefore, are viewed useful for further studies in the field. Exploratory studies such as this one establish the context for further quantitative analysis, identify needs for the research, broaden the knowledge of the researcher, and clarify the existing theories in the field of study [83]. However, such research endeavors are viewed descriptive, general and are criticized for not presenting field data, statistical analysis, and other quantitative procedures to establish the relationship among the research variables. Research quality can be influenced by the researcher personal experience, rigor is more difficult to achieve, and findings are difficult to understand [84]. Moreover, some researchers question the validity and reliability of the findings of such studies since the information is obtained through document analysis and secondary sources. This demands from the researcher to scrutinize and critically evaluate the source or the origin of the information used in the study.

Therefore, future studies in the field should consider several considerations. First, studies should only analyze the relationship whether correlations or causal relationships between the research variables, but also and most importantly to give weight to the moderating and mediating variables. **Figure 2** demonstrates that there several emerging variables (factors) that can have powerful moderating roles in establishing the relationship between the dependent (corporate management culture) and independent (national culture) variables in this study. For example, **Figure 2** suggests that variables such as information technologies, globalization, internationalization of HRM, business strategic alliances, workforce diversity, and regionalization may have moderating impacts on how national cultural variables can influence the corporate management cultures. In order to expand the research scope and strengthen the generalization of the results, a few more dependent variables (employee motivation, management orientation, work ethics, and loyalty) could be added to the study and analysis.

value systems of the organizations. This presents several opportunities for the organizations in these two countries. Organizations in different sectors such as oil and gas, textile, education, consulting, research and development can make up strategic alliances to pursue international business ambitions. In addition, companies from Mexico can make direct invest in the Pakistani market and similarly companies from Pakistan can do business in Mexico without fearing of the cross-cultural constraints. Both Mexico and Pakistan are close strategic and business allies of the USA for a long time. Especially, Mexico as a NAFTA member nation

The finding of this chapter presents implications for the corporate leaders in many ways: (1) Even though the Mexican and Pakistani cultures are found to have vivid similarities, these two nations are located far from each other geographically (the distance). Mexico is geographically close to the USA but culturally very far from it. Pakistan is far from the USA both geographically and culturally; (2) Spanish and Urdu languages are in the group of highcontext languages in the world of communication, but still Spanish and Urdu are different languages. Managers from both sides must learn the language in order to communicate and understand the culture. English is a low-context language, but it has become a generic and common business and management language globally. In spite of the fact that Catholicism and Islam share the same faith-roots, differences are huge between Mexican Catholics and Pakistani Muslims when it comes to the practice of religion and the importance given to the religion in one's daily life. Social organization is formed around extended family infrastructure in Pakistan as in Mexico, whereas the US social organization is much more decentralized to nuclear family establishment. Corporate leaders from the USA can have difficult time while working with employees from either Mexico or Pakistan. Other variables of power distance, uncertainty avoidance, collectivism/individualism, masculinity/femininity, and time concept used in this study and the effects of these variables on corporate management cultures suggest that Mexicans and Pakistanis tend to be more similar than different. Again, being Latin American vs. South Asian cultures, the realities on ground can present chal-

Given all those implications described above, managers and investors from the three countries are advised to take national cultures as well as organizational culture into account when developing national and organizational business polices and standards. Managers and investors from these three countries are well aware of the fact that the world is becoming a global village and the need for cross-cultural learning is increasing with the growth of business organizations beyond their national boarder [79]. Individuals bring cultures of origin to work that reflect their particular ongoing histories in various cultural contexts, such as national culture [80]. In this manner, culture guides our choices, commitments, and standards of behavior [81]. Corporate managers are global and have to understand differences in global cultural system. They should be able to work on those differences and adopt managerial practices which are

depends for almost 80% of its international business/investments on the USA.

**4. Implications and recommendations**

52 Organizational Culture

lenges for managers from both side.

cultural sensitive and responsive [82].




**Figure 2.** The role of moderating variables.

In terms of the research methodology used in the study, future studies should use quantitative methods in order to make the study outcomes more understandable and acceptable in the scientific research community. The quantitative method also enhances the validity and reliability of the research results and consequently the recommendations. Qualitative studies as this one are generally appreciated for being explanatory, detailed, and in-depth. Also, changes in the direction of the study are easier as new information emerges and data/information collected based on human observations is more powerful than the quantitative data [85]. On the other side, qualitative studies being dependent on the researcher skills and thus can be easily influenced by the researcher personal biases. It is time-consuming and difficult to assess and communicate [85]. A more formal and field-based study involving business organizations from two countries should be built in order to explore the reality on the ground. This chapter is surely a step forward in that direction.

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### **Author details**

Mohammad Ayub Khan1 \* and Laurie Smith Law2

\*Address all correspondence to: mkhan@itesm.mx

1 Tecnológico de Monterrey, México

2 Iowa State University, USA

### **References**


[9] Hofstede G. Culture's Consequences. London: Sage Publication; 1980

In terms of the research methodology used in the study, future studies should use quantitative methods in order to make the study outcomes more understandable and acceptable in the scientific research community. The quantitative method also enhances the validity and reliability of the research results and consequently the recommendations. Qualitative studies as this one are generally appreciated for being explanatory, detailed, and in-depth. Also, changes in the direction of the study are easier as new information emerges and data/information collected based on human observations is more powerful than the quantitative data [85]. On the other side, qualitative studies being dependent on the researcher skills and thus can be easily influenced by the researcher personal biases. It is time-consuming and difficult to assess and communicate [85]. A more formal and field-based study involving business organizations from two countries should be built in order to explore the reality on the ground.

This chapter is surely a step forward in that direction.

\*Address all correspondence to: mkhan@itesm.mx

\* and Laurie Smith Law2

Journal of International Business Studies. 1999;**30**:799-812

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**Chapter 4**

Provisional chapter

**Project Organizational Culture Framework in**

DOI: 10.5772/intechopen.78628

Project organizational culture (POC) has been recognized as a significant influencing factor of the success or failure of a project. Although numerous studies on this topic have been conducted to develop organizational culture models, these have mainly been for generic business settings, and one has not yet been developed for construction organizations at the project level. The aim of this chapter was to perform this task in Vietnam. A case study shows that cultural artifacts were arranged into a five-factor project organizational culture framework: "Project goal setting," "Contractor assurance," "Cooperative emphasis," "Empowerment assignment," and "Workforce emphasis." The chapter's findings suggest that the construction contracting organizations are more focused on the culture of mission and adaptability, with a relatively higher emphasis on clear project goals and contractor assurance. They favored a culture of involvement less, with a rela-

Keywords: project organizational culture, project culture framework, organizational

Over the years, numerous studies have been conducted on the concept of culture, offering a list of over 160 various definitions of culture [1]. Essentially, culture is acknowledged as a set of learned mores, values, attitudes, and meanings that are shared within a group of people. In the last decades, culture has been examined either in various environments or under various levels; the studies are frequently conducted for national culture, industry culture, and organizational culture. Particularly, renowned organizational culture models have been proposed

> © 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and eproduction in any medium, provided the original work is properly cited.

© 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use,

distribution, and reproduction in any medium, provided the original work is properly cited.

Project Organizational Culture Framework in

**Construction Industry**

Construction Industry

http://dx.doi.org/10.5772/intechopen.78628

Abstract

1. Introduction

Luong Hai Nguyen and Tsunemi Watanabe

Luong Hai Nguyen and Tsunemi Watanabe

Additional information is available at the end of the chapter

tively lower emphasis on empowerment and workforce.

within consideration of an organization's effectiveness.

culture, project management, construction project organization

Additional information is available at the end of the chapter

#### **Project Organizational Culture Framework in Construction Industry** Project Organizational Culture Framework in Construction Industry

DOI: 10.5772/intechopen.78628

Luong Hai Nguyen and Tsunemi Watanabe Luong Hai Nguyen and Tsunemi Watanabe

Additional information is available at the end of the chapter Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.78628

#### Abstract

Project organizational culture (POC) has been recognized as a significant influencing factor of the success or failure of a project. Although numerous studies on this topic have been conducted to develop organizational culture models, these have mainly been for generic business settings, and one has not yet been developed for construction organizations at the project level. The aim of this chapter was to perform this task in Vietnam. A case study shows that cultural artifacts were arranged into a five-factor project organizational culture framework: "Project goal setting," "Contractor assurance," "Cooperative emphasis," "Empowerment assignment," and "Workforce emphasis." The chapter's findings suggest that the construction contracting organizations are more focused on the culture of mission and adaptability, with a relatively higher emphasis on clear project goals and contractor assurance. They favored a culture of involvement less, with a relatively lower emphasis on empowerment and workforce.

Keywords: project organizational culture, project culture framework, organizational culture, project management, construction project organization

### 1. Introduction

Over the years, numerous studies have been conducted on the concept of culture, offering a list of over 160 various definitions of culture [1]. Essentially, culture is acknowledged as a set of learned mores, values, attitudes, and meanings that are shared within a group of people. In the last decades, culture has been examined either in various environments or under various levels; the studies are frequently conducted for national culture, industry culture, and organizational culture. Particularly, renowned organizational culture models have been proposed within consideration of an organization's effectiveness.

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and eproduction in any medium, provided the original work is properly cited. © 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

In the context of construction project organizations (CPOs), among the critical success factors (CSFs) of a CPO, culture factors arguably play a vital role in the success or failure of project management [2–8]. Cultural factors are essential determinants of management practices; thus, culture has recently been examined in the study as a CSF of construction projects [9–11]. To ensure the success of a CPO, management should pay significant attention on understanding of culture aspect and explain how culture's impacts can contribute to the CPO' effectiveness. Although cultural form and its influences are widely recognized in generic businesses, it is still the least studied area in the study of construction management. Thus, studies exploring project culture framework that have intended to provide a useful tool for assisting project management have been focused on less than others (e.g., procurement approaches, project characteristics, or management mechanisms). Among the few studies attempting to explain the form of organizational culture within the project level, Kumaraswamy et al. [12] defined a project culture model within four overlapping groups of sub-cultures: organizational sub-cultures, operational sub-cultures, professional sub-cultures, and individualistic sub-cultures. Thomas et al. [13] employed the Competing Values Framework model, which is based on four basic organizational forms (Market, Clan, Hierarchy, and Adhocracy) to identify the project culture orientation on 13 Australian construction projects. Zou et al. [14] proposed a project culture model based on the study of organizational models, which focuses more on the partnering contract procurement in China, including the five dimensions of integrative, cooperative, goaloriented, flexible, and people-oriented. More recently, Stare [15] suggested a project organizational culture model that emphasizes the attitudes of top and line management in various Slovenian business enterprises related to IT, product development, and civil engineering, which was then used to examine the influence of the model on project performance.

sections. First, the theoretical framework is presented. Next, a case study POC is introduced. Then, the discussions of the results and background of our findings are presented. The conclusions are consequently drawn. In the last section, the limitations and future research are made.

Project Organizational Culture Framework in Construction Industry

http://dx.doi.org/10.5772/intechopen.78628

63

Although culture has been examined widely at different levels of analysis from national culture to organization-level culture, there is still no agreement on the definition of organizational culture. Schneider [19] described organizational culture as things that have been existing in the way people do things around here to succeed. In a more formal manner, Schein [20] defined organizational culture as a pattern of shared basic assumptions that is learned by a group within an organizational setting, to which organization members share the way of feeling, perceiving, and thinking to devote great efforts to solve or explain its problems of external adaptation and internal integration. In the comparable ways, organizational culture refers to the norms, values, and beliefs that form expected behaviors of employees [21, 22], or organizational culture reflects the unique pattern of norms, values, beliefs, and ways of behaving within groups to which it characterize the manner that members combine to get things done [23]. In the work of McNamara [24], organizational culture is also argued as the assumptions, values, norms, and tangible signs (artifacts) of organization members and their behaviors, in which new members consciously or unconsciously are coming to engage with the particular organizational culture for becoming another person. Hofstede [25] and Hofstede et al. [26] defined organizational culture as the collective mental programming that differenti-

Furthermore, organizational culture is agreed with as the way of behaving, identity, pattern of dynamic relationships, "reality," or genetic code within an organization [19]. It is regularly grounded in the philosophies related to the organization's members and is learned by new members through a process of socialization [27]. Organizational culture can also be viewed as the set of elements of an organization that regulates its manner of operating, being, decision making, communicating, and others [28]. In addition, it is argued that organizational culture is rooted in the basic and universally shared problems [20, 29], dilemmas [30], or contradictions [31] which all members of an organization have to deal with. Efforts made by the members to resolve and/or explain these problems and reconcile dilemmas or contradictions regularly yield solutions that are reliable and repeatable, and reflect the organizations' underlying cultural paradigm [20]. Groups of people may encounter the comparable fundamental problems, but each those groups might find their own unique solutions for these problems that set them apart from each other; as a result, this systematic effort is perceived as their culture [29]. In addition, multitude models have been proposed for evaluating organizational culture in the study. Among those models, the following well-known ones have been commonly utilized for years. The typology culture model was firstly proposed by Harrison [32] and then modified by Handy [33], who suggested that four main types of culture exist in organizations: "power

2. Theoretical framework: understanding of project organizational

culture

ates an organization's members from another.

Summarizing the above review, although multiple studies have addressed the formulation of organizational culture, such research has been disparate, and the culture dimensions have been analyzed based on the concepts of organizational culture that are built under the valued-based approach for generic business settings. This approach has been criticized because organizations differ more in work practices than in values [16]. In addition, CPOs are known as temporary settings to which multiple individuals with diverse backgrounds and professionals contribute to the construction project organization, which results in different human behavior and different expectations for a project. Hence, the individuals involved who present complicated behaviors and/or attitudes significantly influence the success of a project. Cultural differences are also believed to be capable of generating conflicts related to individual communication, which decreases the capacity of construction organizations to achieve project objectives [17, 18]. Hence, these studies, to some extent, do not address issues of definition and identification of POC with respect to work-based practices, particularly emphasizing the construction project organizations setting. Nevertheless, questions regarding POC remain unanswered in the context of the construction industry and deserve further investigation. Therefore, this chapter aimed to fill this research gap.

The purpose of this chapter is to define project organizational culture within the perspective of work-based practices. This approach is significant for project management practices, providing a useful tool for supporting the project participants in decision making to archive project objectives as well as the stakeholders' own benefits. After the introduction, we structure our work in six

sections. First, the theoretical framework is presented. Next, a case study POC is introduced. Then, the discussions of the results and background of our findings are presented. The conclusions are consequently drawn. In the last section, the limitations and future research are made.

## 2. Theoretical framework: understanding of project organizational culture

In the context of construction project organizations (CPOs), among the critical success factors (CSFs) of a CPO, culture factors arguably play a vital role in the success or failure of project management [2–8]. Cultural factors are essential determinants of management practices; thus, culture has recently been examined in the study as a CSF of construction projects [9–11]. To ensure the success of a CPO, management should pay significant attention on understanding of culture aspect and explain how culture's impacts can contribute to the CPO' effectiveness. Although cultural form and its influences are widely recognized in generic businesses, it is still the least studied area in the study of construction management. Thus, studies exploring project culture framework that have intended to provide a useful tool for assisting project management have been focused on less than others (e.g., procurement approaches, project characteristics, or management mechanisms). Among the few studies attempting to explain the form of organizational culture within the project level, Kumaraswamy et al. [12] defined a project culture model within four overlapping groups of sub-cultures: organizational sub-cultures, operational sub-cultures, professional sub-cultures, and individualistic sub-cultures. Thomas et al. [13] employed the Competing Values Framework model, which is based on four basic organizational forms (Market, Clan, Hierarchy, and Adhocracy) to identify the project culture orientation on 13 Australian construction projects. Zou et al. [14] proposed a project culture model based on the study of organizational models, which focuses more on the partnering contract procurement in China, including the five dimensions of integrative, cooperative, goaloriented, flexible, and people-oriented. More recently, Stare [15] suggested a project organizational culture model that emphasizes the attitudes of top and line management in various Slovenian business enterprises related to IT, product development, and civil engineering,

62 Organizational Culture

which was then used to examine the influence of the model on project performance.

investigation. Therefore, this chapter aimed to fill this research gap.

Summarizing the above review, although multiple studies have addressed the formulation of organizational culture, such research has been disparate, and the culture dimensions have been analyzed based on the concepts of organizational culture that are built under the valued-based approach for generic business settings. This approach has been criticized because organizations differ more in work practices than in values [16]. In addition, CPOs are known as temporary settings to which multiple individuals with diverse backgrounds and professionals contribute to the construction project organization, which results in different human behavior and different expectations for a project. Hence, the individuals involved who present complicated behaviors and/or attitudes significantly influence the success of a project. Cultural differences are also believed to be capable of generating conflicts related to individual communication, which decreases the capacity of construction organizations to achieve project objectives [17, 18]. Hence, these studies, to some extent, do not address issues of definition and identification of POC with respect to work-based practices, particularly emphasizing the construction project organizations setting. Nevertheless, questions regarding POC remain unanswered in the context of the construction industry and deserve further

The purpose of this chapter is to define project organizational culture within the perspective of work-based practices. This approach is significant for project management practices, providing a useful tool for supporting the project participants in decision making to archive project objectives as well as the stakeholders' own benefits. After the introduction, we structure our work in six Although culture has been examined widely at different levels of analysis from national culture to organization-level culture, there is still no agreement on the definition of organizational culture. Schneider [19] described organizational culture as things that have been existing in the way people do things around here to succeed. In a more formal manner, Schein [20] defined organizational culture as a pattern of shared basic assumptions that is learned by a group within an organizational setting, to which organization members share the way of feeling, perceiving, and thinking to devote great efforts to solve or explain its problems of external adaptation and internal integration. In the comparable ways, organizational culture refers to the norms, values, and beliefs that form expected behaviors of employees [21, 22], or organizational culture reflects the unique pattern of norms, values, beliefs, and ways of behaving within groups to which it characterize the manner that members combine to get things done [23]. In the work of McNamara [24], organizational culture is also argued as the assumptions, values, norms, and tangible signs (artifacts) of organization members and their behaviors, in which new members consciously or unconsciously are coming to engage with the particular organizational culture for becoming another person. Hofstede [25] and Hofstede et al. [26] defined organizational culture as the collective mental programming that differentiates an organization's members from another.

Furthermore, organizational culture is agreed with as the way of behaving, identity, pattern of dynamic relationships, "reality," or genetic code within an organization [19]. It is regularly grounded in the philosophies related to the organization's members and is learned by new members through a process of socialization [27]. Organizational culture can also be viewed as the set of elements of an organization that regulates its manner of operating, being, decision making, communicating, and others [28]. In addition, it is argued that organizational culture is rooted in the basic and universally shared problems [20, 29], dilemmas [30], or contradictions [31] which all members of an organization have to deal with. Efforts made by the members to resolve and/or explain these problems and reconcile dilemmas or contradictions regularly yield solutions that are reliable and repeatable, and reflect the organizations' underlying cultural paradigm [20]. Groups of people may encounter the comparable fundamental problems, but each those groups might find their own unique solutions for these problems that set them apart from each other; as a result, this systematic effort is perceived as their culture [29].

In addition, multitude models have been proposed for evaluating organizational culture in the study. Among those models, the following well-known ones have been commonly utilized for years. The typology culture model was firstly proposed by Harrison [32] and then modified by Handy [33], who suggested that four main types of culture exist in organizations: "power orientation," "role orientation," "task orientation," and "person orientation." This model emphasized on how processes are conducted and decisions are made within a culture. Deal and Kennedy [34] proposed a model of corporate culture that emphasizes on what kinds of decisions have to be made—are the stakes high and how quickly does the decision maker know if the decision was right. The model encompasses four types of culture: "Work Hard/ Play Hard," "Touch- Guy/Macho/Star," "Process," and "Bet-Your-Company," which are based on two dimensions: the risk level of the company's businesses and the speed of feedback on decisions and/or strategies are made. Hofstede et al. [35] defined an organizational culture model founded on six dimensions: internally driven versus externally driven; easygoing work discipline versus strict work discipline; local versus professional; open system versus closed system; employee-oriented versus work-oriented, which is defined as perceived common practices (i.e., symbols, heroes, and rituals) that carry a specific meaning within the organizational unit; means-oriented versus goal-oriented. Denison and Mishra [36] identified four different cultural traits that reflect diverse dimensions of an organization's effectiveness: adaptability, mission, involvement, and consistency. Schneider [19] defines a four-squarematrix culture model that emphasizes more on the way of thinking in the decision-making process, including four dimensions: "Collaboration," "Control," "Cultivation," and "Competency." The Competing Values Framework proposed by Cameron and Quinn [37] recognizes four types of culture in organizations: Clan, Adhocracy, Hierarchy, and Market, to which the values held by the organization are emphasized.

operational perspective—"as embodied in the organization's structures, mechanisms and practices" [40]. In this form, culture is reflected in concern actions that characterize the interactions between individuals and working life rather than statements of values and beliefs; this may be a poor starting point for understanding culture and is out of step with culture as implemented in actions. Culture should thus be understood in a way that reflects the decisions, choices, options, and explanations related to norms of behavior and practice [40]. Taken together, these arguments support the view that consistent and widespread practices reflect organizational culture [41]. It is justifiable to approach culture from its reflections, the organizational practices, which are more readily observable and measurable and can thus be compared across organizations and directly related to individual and organizational performance. Organizational practices are described as "particular ways of conducting organizational functions that evolved over time… [These] practices reflect the shared knowledge and competence of the organization" [42]. Based on these concepts of organizational practices, organizational culture is specifically defined as "a shared perception of organizational work practices within organizational units that may differ from other organizational units" [39]. Specifically, the construction project organization is performed as a temporary organization, where diverse contracting organizations gather and set the pattern of interrelationships, authority, and responsibility to accomplish the project's goals and objectives within the project life cycle. In the domain of project management, the CSFs in terms of managerial support, communication, relationships, participant involvement, and decision making [4, 43, 44] have been explored, which may be viewed as the "cultural" manifestations at the project level that assess the patterns of project participants' regular work behaviors and/or attitudes over the course of

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This study therefore proposes that project organizational culture can be identified by examining relevant project participants' work behaviors that reflect the methods of explanation or resolution for problems encountered over the course of a project. To develop each project's organizational culture, it was therefore necessary to examine the sources of practice problems that project participants must address or for which they must find solutions. Building upon this perspective of cultural identification, examining project participants' work behaviors is pivotal to determining culture within project organizations. Measuring cultural artifacts is thus expected to involve examining the level of project participants' work behaviors. Thus, when examining the dimensions of the organizational culture of a construction project, one could argue that a useful source of information should be obtained in consultation with key practi-

3. Project organizational culture framework: a case of construction

This section presents findings derived from our contemporary studies on POC. It shows the POC approach, how the research methodologies were conducted, and research results were

the project.

tioners involved in the project delivery process.

industry in Vietnam

interpreted.

The study on this issue has shown that definitions of organizational culture commonly pertain to basic assumptions [20], values and norms [23], beliefs [23], and mental programs [26]. Furthermore, organizational culture is defined as manners of behaving [6, 23] and work practices [16]. The divergence of the standard definition of organizational culture is understandable since the concept of organizational culture was derived from anthropology, where there was no consensus on culture's meaning [38]. Hence, there is no surprise of a multiplicity in culture definitions and its applications within organizational studies, making cultural appearances contextually diverse. Culture manifestations are either the large invisibilities that pertain to values, beliefs, and underlying assumptions [20, 29], or the visibilities, including artifacts, creations, and behavioral norms [20], which were referred to as "practices" by Hofstede et al. [26]. Thus, it could be argued that values and practices are two-side reflections of culture. Values reflect the preferences of people in work and life-related issues, whereas practices reflect the employees' descriptive perceptions of aspects of the work environment or actual work situation [26]. Hence, culture will become more readily readable when approaching from the two-side descriptions of culture, values, and practices.

Although traditional approaches have largely analyzed organizational culture based on the concept of values and basic assumptions, which are known critical aspects of organizational culture, the study has argued that organizations are more recognized in work practices than in values [16, 26]. It has also been argued that because significant aspects of values are often observable through organizational practices, there is also undoubtedly a capacity for measurement of values from work practices [26, 39]. This approach is also in line with the argument that the traditional approach of culture based on notions of shared values, beliefs, and basic assumptions is inadequate; instead, organizational culture should be argued from a strongly operational perspective—"as embodied in the organization's structures, mechanisms and practices" [40]. In this form, culture is reflected in concern actions that characterize the interactions between individuals and working life rather than statements of values and beliefs; this may be a poor starting point for understanding culture and is out of step with culture as implemented in actions. Culture should thus be understood in a way that reflects the decisions, choices, options, and explanations related to norms of behavior and practice [40]. Taken together, these arguments support the view that consistent and widespread practices reflect organizational culture [41]. It is justifiable to approach culture from its reflections, the organizational practices, which are more readily observable and measurable and can thus be compared across organizations and directly related to individual and organizational performance.

orientation," "role orientation," "task orientation," and "person orientation." This model emphasized on how processes are conducted and decisions are made within a culture. Deal and Kennedy [34] proposed a model of corporate culture that emphasizes on what kinds of decisions have to be made—are the stakes high and how quickly does the decision maker know if the decision was right. The model encompasses four types of culture: "Work Hard/ Play Hard," "Touch- Guy/Macho/Star," "Process," and "Bet-Your-Company," which are based on two dimensions: the risk level of the company's businesses and the speed of feedback on decisions and/or strategies are made. Hofstede et al. [35] defined an organizational culture model founded on six dimensions: internally driven versus externally driven; easygoing work discipline versus strict work discipline; local versus professional; open system versus closed system; employee-oriented versus work-oriented, which is defined as perceived common practices (i.e., symbols, heroes, and rituals) that carry a specific meaning within the organizational unit; means-oriented versus goal-oriented. Denison and Mishra [36] identified four different cultural traits that reflect diverse dimensions of an organization's effectiveness: adaptability, mission, involvement, and consistency. Schneider [19] defines a four-squarematrix culture model that emphasizes more on the way of thinking in the decision-making process, including four dimensions: "Collaboration," "Control," "Cultivation," and "Competency." The Competing Values Framework proposed by Cameron and Quinn [37] recognizes four types of culture in organizations: Clan, Adhocracy, Hierarchy, and Market, to which the

The study on this issue has shown that definitions of organizational culture commonly pertain to basic assumptions [20], values and norms [23], beliefs [23], and mental programs [26]. Furthermore, organizational culture is defined as manners of behaving [6, 23] and work practices [16]. The divergence of the standard definition of organizational culture is understandable since the concept of organizational culture was derived from anthropology, where there was no consensus on culture's meaning [38]. Hence, there is no surprise of a multiplicity in culture definitions and its applications within organizational studies, making cultural appearances contextually diverse. Culture manifestations are either the large invisibilities that pertain to values, beliefs, and underlying assumptions [20, 29], or the visibilities, including artifacts, creations, and behavioral norms [20], which were referred to as "practices" by Hofstede et al. [26]. Thus, it could be argued that values and practices are two-side reflections of culture. Values reflect the preferences of people in work and life-related issues, whereas practices reflect the employees' descriptive perceptions of aspects of the work environment or actual work situation [26]. Hence, culture will become more readily readable when approac-

Although traditional approaches have largely analyzed organizational culture based on the concept of values and basic assumptions, which are known critical aspects of organizational culture, the study has argued that organizations are more recognized in work practices than in values [16, 26]. It has also been argued that because significant aspects of values are often observable through organizational practices, there is also undoubtedly a capacity for measurement of values from work practices [26, 39]. This approach is also in line with the argument that the traditional approach of culture based on notions of shared values, beliefs, and basic assumptions is inadequate; instead, organizational culture should be argued from a strongly

values held by the organization are emphasized.

64 Organizational Culture

hing from the two-side descriptions of culture, values, and practices.

Organizational practices are described as "particular ways of conducting organizational functions that evolved over time… [These] practices reflect the shared knowledge and competence of the organization" [42]. Based on these concepts of organizational practices, organizational culture is specifically defined as "a shared perception of organizational work practices within organizational units that may differ from other organizational units" [39]. Specifically, the construction project organization is performed as a temporary organization, where diverse contracting organizations gather and set the pattern of interrelationships, authority, and responsibility to accomplish the project's goals and objectives within the project life cycle. In the domain of project management, the CSFs in terms of managerial support, communication, relationships, participant involvement, and decision making [4, 43, 44] have been explored, which may be viewed as the "cultural" manifestations at the project level that assess the patterns of project participants' regular work behaviors and/or attitudes over the course of the project.

This study therefore proposes that project organizational culture can be identified by examining relevant project participants' work behaviors that reflect the methods of explanation or resolution for problems encountered over the course of a project. To develop each project's organizational culture, it was therefore necessary to examine the sources of practice problems that project participants must address or for which they must find solutions. Building upon this perspective of cultural identification, examining project participants' work behaviors is pivotal to determining culture within project organizations. Measuring cultural artifacts is thus expected to involve examining the level of project participants' work behaviors. Thus, when examining the dimensions of the organizational culture of a construction project, one could argue that a useful source of information should be obtained in consultation with key practitioners involved in the project delivery process.

### 3. Project organizational culture framework: a case of construction industry in Vietnam

This section presents findings derived from our contemporary studies on POC. It shows the POC approach, how the research methodologies were conducted, and research results were interpreted.

#### 3.1. Identifying project organizational culture artifacts

To approach organizational culture from perspective of work-based practices, literature review focus group studies (FGSs), face-to-face interviews, and field observations were the key tools used to develop culture artifacts. Cultural artifacts identified from the literature reviews were further verified and adapted by the interviews, FGSs, and field observation before they were adopted as the measures in the survey. In the first stage of cultural artifact development, the FGSs, which are considered a good approach for investigating the cultural differences [45], were conducted within construction practitioners in Vietnam. In total, six FGSs were conducted in the six largest metropolitan cities in diverse areas in Vietnam: Ha Noi (the capital), Hai Phong (the largest economic city in the eastern North), Ho Chi Minh (the largest economic city in the South), Vinh (the largest economic city in northern midland), Da Nang (the midland capital city), and Can Tho (the main city of the Mekong Delta in the south), with one FGS in each city. The participants invited in each FGS were well-experienced construction professionals working for clients, contractors, and consultant businesses in the cities, with nine participants in each FGS. The selected participants' backgrounds included architects, designers, surveyors, project managers, and supervisory officers. In the second stage, face-to-face interviews were conducted with key experts. This stage covered the customization of the preliminary list of identified cultural artifacts in stage 1. Targeted interviewees included professionals with adequate experience in managing construction projects. In addition, field observations were conducted within on-going and complete construction projects in Vietnam to obtain a clear view of practices related to the study data collection.

which relates to contractor commitment to project performance, client commitment to the agreement, and the accountability of supervisors, and (5) how project managers or project leaders transfer his/her roles over the course of a project, which includes the competency of the project managers and project team leaders, communication between the project manager and subordinates and participant involvement in decision-making processes. As a result, 29 artifacts were

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Based on the studies and discussions with key project's stakeholders, case-specific data were collected by practitioners involved in construction projects in Vietnam who served as project managers for clients and contractors. This approach was also validated by consultations for a pilot study to determine that clients and contractors with positions of project leaders, managing directors, and senior engineers were mostly the appropriate respondents to the survey. In the pilot study, scholars and professionals were invited to review and comment. Those participants included five professors who were affiliated with universities in the field of project management, 15 expert professionals who were five senior managers from contractors, six project managers from clients, and five senior engineers from consultant companies. Having 21 interviewees was well qualified in a qualitative study, which is above the 15 threshold suggested by Bertaux [46].

As a result, official questionnaires were distributed to 419 randomly targeted participants who were asked to answer the specific survey questions based on the most recently completed project in which they participated. A final sample of 199 valid responses was obtained for investigation. Among the final set of valid samples, 169 of the respondents were from contractors and the remaining 30 were from clients. Regarding respondents' backgrounds, 100% of the respondents played roles as project managers during the project delivery, and 79% of them had more than 5 years of experience in construction project management. Regarding the types of projects, 110 of the projects were infrastructure systems, including roads, bridges, and water supply systems; 78 of the projects were residential and/or commercials buildings; and 11 of the projects were industrial facilities. Regarding the scale of the projects, 49 were large investments (national level), 113 were mid-range investments (budget >VND 15 billion), and 37 were small-scale investments. The respondents were asked to indicate their experience in a recently completed construction project on a five-point Likert scale of one (strongly disagree/not at all satisfied) to five (strongly agree/extremely satisfied). Principal component analysis (PCA) was conducted to examine the factor structure of the cultural artifacts as collected. PCA is an effective tool for demonstrating convergent and discriminant validity and for principally diminishing the number of variable factors [47] and avoiding multicollinearity [48]. The eigenvalue is reliably used to establish a cutoff when the number of artifacts is between 20 and 50 [47]. Hence, using the eigenvalue criterion is appropriate for this study, which was performed with 29 artifacts. Factors with eigenvalues greater than or equal to 1 were considered significant. In addition, Cronbach's alpha was used to verify the reliability of the factorized artifacts [49]. The alpha value ranged from 0 to 1; the higher the alpha value, the more reliable the groupings of artifacts. Cronbach's alpha value

greater than 0.7 is considered "good" and/or "acceptable" in reliability testing [49, 50].

enlisted and suggested for the measurement of project organizational culture (Table 1).

Meanwhile, all of 21 interviews were in agreement with the verification.

3.2. Data collection and measures

The purpose of the FGSs and face-to-face interviews was to discuss the common problems in regard to the project delivery process and to clarify the traits of project organizational culture. Discussions and interviews were performed based on a semi-structured manner. A selection of primary questions is listed as follows: (1) what common problems occur over the course of a project? (2) Can you describe those problems in detail? (3) Have you ever heard of culture as a general concept or from the perspective of project management? (4) What do you understand about culture within CPOs? (5) How would you describe project organizational culture? (6) What should cultural artifacts measure in terms of project participants' behaviors/attitudes? (7) In your experience, who is appropriate for assessing these behaviors or attitudes?

The face-to-face interviews and FGSs with stakeholders suggested that the cultural artifacts should measure behaviors that reflect practices over the course of a project. Particularly, these practices should concern with (1) how project participants are expected to clarify the pursuit of project goals, which relates to participant responsibility for project goals, clear objectives for participants, participant commitment to achieve project goals, and conflicts of interest; (2) the work environment that assists project participants in interacting with and supporting each other over the course of a project, which relates to information sharing, the openness of the environment, support from top management, mutual trust among participants, mutual respect among participants, and assignment of blame in the event of disruptions; (3) emphasis on workforce, which should pertain to work conditions, employee participation in decision making, work training, and the respectful treatment of workers; (4) the extent to which project participants commit to project goals in the context of balancing them with other potentially competing goals, which relates to contractor commitment to project performance, client commitment to the agreement, and the accountability of supervisors, and (5) how project managers or project leaders transfer his/her roles over the course of a project, which includes the competency of the project managers and project team leaders, communication between the project manager and subordinates and participant involvement in decision-making processes. As a result, 29 artifacts were enlisted and suggested for the measurement of project organizational culture (Table 1).

#### 3.2. Data collection and measures

3.1. Identifying project organizational culture artifacts

study data collection.

66 Organizational Culture

To approach organizational culture from perspective of work-based practices, literature review focus group studies (FGSs), face-to-face interviews, and field observations were the key tools used to develop culture artifacts. Cultural artifacts identified from the literature reviews were further verified and adapted by the interviews, FGSs, and field observation before they were adopted as the measures in the survey. In the first stage of cultural artifact development, the FGSs, which are considered a good approach for investigating the cultural differences [45], were conducted within construction practitioners in Vietnam. In total, six FGSs were conducted in the six largest metropolitan cities in diverse areas in Vietnam: Ha Noi (the capital), Hai Phong (the largest economic city in the eastern North), Ho Chi Minh (the largest economic city in the South), Vinh (the largest economic city in northern midland), Da Nang (the midland capital city), and Can Tho (the main city of the Mekong Delta in the south), with one FGS in each city. The participants invited in each FGS were well-experienced construction professionals working for clients, contractors, and consultant businesses in the cities, with nine participants in each FGS. The selected participants' backgrounds included architects, designers, surveyors, project managers, and supervisory officers. In the second stage, face-to-face interviews were conducted with key experts. This stage covered the customization of the preliminary list of identified cultural artifacts in stage 1. Targeted interviewees included professionals with adequate experience in managing construction projects. In addition, field observations were conducted within on-going and complete construction projects in Vietnam to obtain a clear view of practices related to the

The purpose of the FGSs and face-to-face interviews was to discuss the common problems in regard to the project delivery process and to clarify the traits of project organizational culture. Discussions and interviews were performed based on a semi-structured manner. A selection of primary questions is listed as follows: (1) what common problems occur over the course of a project? (2) Can you describe those problems in detail? (3) Have you ever heard of culture as a general concept or from the perspective of project management? (4) What do you understand about culture within CPOs? (5) How would you describe project organizational culture? (6) What should cultural artifacts measure in terms of project participants' behaviors/attitudes? (7)

The face-to-face interviews and FGSs with stakeholders suggested that the cultural artifacts should measure behaviors that reflect practices over the course of a project. Particularly, these practices should concern with (1) how project participants are expected to clarify the pursuit of project goals, which relates to participant responsibility for project goals, clear objectives for participants, participant commitment to achieve project goals, and conflicts of interest; (2) the work environment that assists project participants in interacting with and supporting each other over the course of a project, which relates to information sharing, the openness of the environment, support from top management, mutual trust among participants, mutual respect among participants, and assignment of blame in the event of disruptions; (3) emphasis on workforce, which should pertain to work conditions, employee participation in decision making, work training, and the respectful treatment of workers; (4) the extent to which project participants commit to project goals in the context of balancing them with other potentially competing goals,

In your experience, who is appropriate for assessing these behaviors or attitudes?

Based on the studies and discussions with key project's stakeholders, case-specific data were collected by practitioners involved in construction projects in Vietnam who served as project managers for clients and contractors. This approach was also validated by consultations for a pilot study to determine that clients and contractors with positions of project leaders, managing directors, and senior engineers were mostly the appropriate respondents to the survey. In the pilot study, scholars and professionals were invited to review and comment. Those participants included five professors who were affiliated with universities in the field of project management, 15 expert professionals who were five senior managers from contractors, six project managers from clients, and five senior engineers from consultant companies. Having 21 interviewees was well qualified in a qualitative study, which is above the 15 threshold suggested by Bertaux [46]. Meanwhile, all of 21 interviews were in agreement with the verification.

As a result, official questionnaires were distributed to 419 randomly targeted participants who were asked to answer the specific survey questions based on the most recently completed project in which they participated. A final sample of 199 valid responses was obtained for investigation. Among the final set of valid samples, 169 of the respondents were from contractors and the remaining 30 were from clients. Regarding respondents' backgrounds, 100% of the respondents played roles as project managers during the project delivery, and 79% of them had more than 5 years of experience in construction project management. Regarding the types of projects, 110 of the projects were infrastructure systems, including roads, bridges, and water supply systems; 78 of the projects were residential and/or commercials buildings; and 11 of the projects were industrial facilities. Regarding the scale of the projects, 49 were large investments (national level), 113 were mid-range investments (budget >VND 15 billion), and 37 were small-scale investments.

The respondents were asked to indicate their experience in a recently completed construction project on a five-point Likert scale of one (strongly disagree/not at all satisfied) to five (strongly agree/extremely satisfied). Principal component analysis (PCA) was conducted to examine the factor structure of the cultural artifacts as collected. PCA is an effective tool for demonstrating convergent and discriminant validity and for principally diminishing the number of variable factors [47] and avoiding multicollinearity [48]. The eigenvalue is reliably used to establish a cutoff when the number of artifacts is between 20 and 50 [47]. Hence, using the eigenvalue criterion is appropriate for this study, which was performed with 29 artifacts. Factors with eigenvalues greater than or equal to 1 were considered significant. In addition, Cronbach's alpha was used to verify the reliability of the factorized artifacts [49]. The alpha value ranged from 0 to 1; the higher the alpha value, the more reliable the groupings of artifacts. Cronbach's alpha value greater than 0.7 is considered "good" and/or "acceptable" in reliability testing [49, 50].

#### Project organizational culture artifacts Descriptions


• Objectives and values of the project are clearly understood by project participants.

3.3. Exploratory factor analysis on project organizational culture artifacts

acceptable [52].

PCA was employed to investigate the underlying factors of 29 cultural artifacts. The results of the PCA (Table 2) using the Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy, which is relatively higher than the suggested threshold of 0.60 [51], and Bartlett's test were highly significant (p > 0.000) [47], showing that the data were suitable for factor analysis. Factor loadings above the 0.40 threshold were considered [52, 53]. The final results of the exploratory factor analysis showed that the five cultural components that were initially extracted accounted for 62.49% of the total variance in the 29 cultural artifacts with an eigenvalue greater than one, indicating five project organizational culture factors. Cronbach's alpha values ranged from 0.66 to 0.90, which indicates that the internal consistency reliability of all extracted factors was

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Eleven artifacts were extracted as significant in cultural factor 1 (C1): (AG1) project's objectives clarification, (AG2) obligations clarification by contractor, (AG3) obligations clarification by client, (AG4) mutual understanding, (AC2) information exchange, (AC3) roles of project manager, (AC4) trust-sharing atmosphere, (AP1) value project participants' contributions, (AP2) available opportunities, (ASA4) supervisor's obligation to work, and (AH1) leadership. Considering the artifact descriptions provided in Table 1, artifacts (AG1, AG2, and AG3) can reflect the effectiveness of project goal clarification over the course of a project. The remaining items in cultural factor 1 could be used to assess the degree to which people are reliable and motivated in terms of achieving project goals. This culture factor is called project goal setting. Cultural factor 2 (C2) comprised nine items: (AG5) commitment of project benefits, (AC1) effective interactions at work, (AC5) openness and mutual respect, (AC6) idea exchange and support, (AC7) assignment of blame and accountability, (AP4) recognize achievements, (ACA5) client's obligation to agreements, (AH4) instruction by project leaders, and (AH5) participation in decision making. The conceptualization of the artifacts extracted in factor 2 contributes to cooperation in the work environment. Thus, cultural factor 2 is called cooperative emphasis. Three items were significantly organized in cultural factor 3 (C3): (ACA1) the contractor's assurance of project quality, (ACA2) the contractor's assurance of the project schedule, and (ACA3) the contractor's assurance of the project budget. These artifacts reflect the degree to which the contractor is committed to project outcomes. Thus, this cultural factor is called contractor assurance. Cultural factor 4 (C4) is labeled workforce emphasis, which consists of three artifacts that are associated with the extent to which the workforce is concerned: (AP5) emphasize training works, (AP6) encouragement of respectful attitudes to workers, and (AP7) emphasize good conditions for workers. The taxonomy of factor 5 (C5) includes three items: (AP3) promote empowerment, (AH2) encouragement in decision making, and (AH3) the direction by project leaders. This cultural factor is called empowerment assignment because the extracted items reflect the level at which empowered individuals are involved in making decisions regarding the achievement of the project goals. In summary, the PCA identified the following five factors of project organizational culture for the construction industry: (C1) project goal setting, (C2) cooperative emphasis, (C3) contractor assurance, (C4) workforce emphasis, and (C5) empowerment assignment. These factors are suggested as the

formulation of a construction project organizational culture framework in industry.


Table 1. Artifacts of project organizational culture.

#### 3.3. Exploratory factor analysis on project organizational culture artifacts

Project organizational culture artifacts Descriptions

• Objectives and values of the project are clearly understood by project

• All project participants concern each other's objectives, expectations, and

• When disputes or conflicts occur, the participants first look at how the project would benefit rather than how they would benefit.

• Effective working relationships among the participants are promoted in terms of exploring innovative solutions and reducing costs and time

• Information is shared, transparent, and available to participants over the

• Assignment of blame and accountability issues is (not) emphasized when

• All project participants are encouraged to develop their capabilities over

• Project participants are empowered to make decisions by themselves at

• Project participants take pride in or celebrate achievements when they

• Workers are scheduled to attend any training sessions regarding skills

• Workers are really being treated with respect over the course of project.

• The contractors emphasize committing to the project's success with

• The contractors emphasize committing to the project's success with

• The contractors emphasize committing to the project's success with

• The client emphasizes obligation to the contract agreements.

process over the course of the project.

• Project leaders are encouraged to show their strong leadership. • Decision making is liberally encouraged at every level.

• Project leaders always ensure that their subordinates know what is

• Project leaders always ensure that individual accountability is clear. • All project members are encouraged to participate in the decision-making

• The supervisor emphasizes obligation to making the project successful.

• All project participants are valued as important contributors to the

things go wrong over the course of a project.

• Workers are concerned about health and welfare.

• Project managers assist, support, and clearly communicate with their subordinates, ensuring accomplishment of project objectives. • There is an atmosphere of mutual trust generated by project participants. • The project participants are open and respectful of one another. • The project participants are encouraged to exchange ideas and to help one

• The contractors clearly understand their required roles and duties. • The client clearly understands their required roles and duties.

participants.

values.

spent.

another.

any level.

and safety.

regard to quality.

expected of them.

regard to the schedule.

regard to contract costs.

course of the project.

success of the project.

the course of the project.

achieve production milestones.

• Project objectives clarification • Obligation clarification by contractors

68 Organizational Culture

• Obligation clarification by clients • Mutual understanding • Commitment of project benefits

• Effective interactions at work • Information exchange • Roles of project manager • Trust-sharing atmosphere • Mutual respect and openness • Idea exchange and support • Assignment of blame and accountability

• Value project participants' contributions • Available opportunities • Promote empowerment • Recognize achievements • Emphasize training works • Encouragement of respectful attitudes toward workers • Emphasize good conditions for

• Contractor's assurance to project

• Contractor's assurance to project

• Contractor's assurance to project

• Supervisor's obligation to work • Client's obligation to agreements

• Emphasize leadership • Encouragement in decision

• Direction by project leaders • Instruction by project leaders • Participation in decision making

Table 1. Artifacts of project organizational culture.

workers

quality

schedule

budget

making

PCA was employed to investigate the underlying factors of 29 cultural artifacts. The results of the PCA (Table 2) using the Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy, which is relatively higher than the suggested threshold of 0.60 [51], and Bartlett's test were highly significant (p > 0.000) [47], showing that the data were suitable for factor analysis. Factor loadings above the 0.40 threshold were considered [52, 53]. The final results of the exploratory factor analysis showed that the five cultural components that were initially extracted accounted for 62.49% of the total variance in the 29 cultural artifacts with an eigenvalue greater than one, indicating five project organizational culture factors. Cronbach's alpha values ranged from 0.66 to 0.90, which indicates that the internal consistency reliability of all extracted factors was acceptable [52].

Eleven artifacts were extracted as significant in cultural factor 1 (C1): (AG1) project's objectives clarification, (AG2) obligations clarification by contractor, (AG3) obligations clarification by client, (AG4) mutual understanding, (AC2) information exchange, (AC3) roles of project manager, (AC4) trust-sharing atmosphere, (AP1) value project participants' contributions, (AP2) available opportunities, (ASA4) supervisor's obligation to work, and (AH1) leadership. Considering the artifact descriptions provided in Table 1, artifacts (AG1, AG2, and AG3) can reflect the effectiveness of project goal clarification over the course of a project. The remaining items in cultural factor 1 could be used to assess the degree to which people are reliable and motivated in terms of achieving project goals. This culture factor is called project goal setting. Cultural factor 2 (C2) comprised nine items: (AG5) commitment of project benefits, (AC1) effective interactions at work, (AC5) openness and mutual respect, (AC6) idea exchange and support, (AC7) assignment of blame and accountability, (AP4) recognize achievements, (ACA5) client's obligation to agreements, (AH4) instruction by project leaders, and (AH5) participation in decision making. The conceptualization of the artifacts extracted in factor 2 contributes to cooperation in the work environment. Thus, cultural factor 2 is called cooperative emphasis. Three items were significantly organized in cultural factor 3 (C3): (ACA1) the contractor's assurance of project quality, (ACA2) the contractor's assurance of the project schedule, and (ACA3) the contractor's assurance of the project budget. These artifacts reflect the degree to which the contractor is committed to project outcomes. Thus, this cultural factor is called contractor assurance. Cultural factor 4 (C4) is labeled workforce emphasis, which consists of three artifacts that are associated with the extent to which the workforce is concerned: (AP5) emphasize training works, (AP6) encouragement of respectful attitudes to workers, and (AP7) emphasize good conditions for workers. The taxonomy of factor 5 (C5) includes three items: (AP3) promote empowerment, (AH2) encouragement in decision making, and (AH3) the direction by project leaders. This cultural factor is called empowerment assignment because the extracted items reflect the level at which empowered individuals are involved in making decisions regarding the achievement of the project goals. In summary, the PCA identified the following five factors of project organizational culture for the construction industry: (C1) project goal setting, (C2) cooperative emphasis, (C3) contractor assurance, (C4) workforce emphasis, and (C5) empowerment assignment. These factors are suggested as the formulation of a construction project organizational culture framework in industry.

#### 70 Organizational Culture


4. Result interpretations and discussions

artifact.

To examine the higher explanatory power of cultural dimensions for project performance, the statistical characteristics of all components are discussed. Table 3 shows the mean value (MCV) and standard deviation (SDCV) of the CV of the artifacts categorized in each component. The MCV and SDCV in each component are represented as C1 (low, high), C3 (medium, low), C2 (medium, high), C4 (medium, high), or C5 (high, low). With the introduction of the combination values of MCV and SDCV, the statistical characteristics of each component can be comprehensively discussed. Table 4 shows the frequency, mean, and standard deviation of the significance scores (SSs) and their ranks and the coefficient variation (CV) of each cultural

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The first characteristic of C1 is its high explanatory power of the variance in PCFA, which is 43.0% (Table 4). C1 dominates in capturing the structural characteristics of the SSs of all artifacts much more effectively than the other components. Thus, C1 is the most "authoritative criterion" to judge whether each project belongs to the "majority" or "minority." The second characteristic of C1 is low MCV. Low MCV indicates a high mean and a low standard deviation of the SS. Thus, the artifacts in C1 were practiced most intensively and widely in the surveyed projects. Therefore, the characteristics of C1 are its dominant power to capture the structural characteristics of the entire data of the SSs and the most intensive and wide practice of its artifacts. The practical interpretation is that a project in which artifacts in C1 are not intensively practiced is considered a minority project (from the second characteristic) and actually a "true" minority project (from the first characteristic). These characteristics are expected to be the foundation of C1's high explanatory power for project performance.

The first characteristic of C3 is a lower explanatory power of the variance in PCFA than C1, which was 5.15% (Table 2). It should be noted that C3 thus does not form "major" statistical structural characteristics of the SSs of all artifacts, unlike C1. The second characteristic of C3 is medium MCV and low SDCV. Medium MCV indicates a medium mean and a medium standard deviation of the SS. Medium MCV implies that artifacts in C3 are generally practiced intensively and widely but not as intensively or widely as in C1. Low SDCV indicates that the CVs are not varied among the artifacts in the component. To determine the reason for this lack of variance, the correlation coefficients of the SSs among the three artifacts in C3, namely ACA1, ACA2, and ACA3, were examined. These correlation coefficients were 0.586, 0.727, and 0.771 in the ascending order. Accordingly, it is possible that all artifacts are practiced similarly. The third characteristic of C3 is its straightforward interpretation: contractor assurance. All artifacts concern contractor assurance. Therefore, the characteristics of

Statistics criteria C1 C2 C3 C4 C5 Mean of CV (MCV) 0.198 0.263 0.239 0.259 0.337 Standard deviation of CV (SDCV) 0.0300 0.0346 0.0127 0.0371 0.0145

Table 3. Mean value and standard deviation of the CV of the artifacts categorized in each component.

Table 2. Results of factor analysis on project organizational cultural artifacts.

### 4. Result interpretations and discussions

Project organizational culture artifacts Code Project organizational culture components

Project objectives clarification AG1 0.72 Obligation clarification by contractor AG2 0.52 Obligation clarification by client AG3 0.64 Mutual understanding AG4 0.72 Information exchange AC2 0.58 Roles of project manager AC3 0.50 Trust-sharing atmosphere AC4 0.54 Value project participants' contributions AP1 0.54 Available opportunities AP2 0.53 Supervisor's obligation to work ASA4 0.51 Emphasize leadership AH1 0.47

70 Organizational Culture

Commitment of project benefits AG5 0.48 Effective interactions at work AC1 0.48 Openness and mutual respect AC5 0.60 Idea exchange and support AC6 0.57 Assignment of blame and accountability AC7 0.65 Recognize achievements AP4 0.41 Client's obligation to agreements ACA5 0.44 Instruction by project leaders AH4 0.70 Participation in decision making AH5 0.64

Contractor assurance to project quality ACA1 0.74 Contractor assurance to project schedule ACA2 0.84 Contractor assurance to project budget ACA3 0.79

Kaiser-Meyer-Olkin measure of sampling adequacy

Bartlett's test of sphericity Approx. chi-square

dif. sig.

Emphasize training works AP5 0.74 Encouragement of respectful attitudes to workers AP6 0.79 Emphasize good conditions for workers AP7 0.78

> 0.92 3.130E3 406 0.000

Table 2. Results of factor analysis on project organizational cultural artifacts.

Promote empowerment AP3 0.58 Encouragement in decision making AH2 0.77 Direction by project leaders AH3 0.61 Eigenvalue 12.47 1.86 1.49 1.23 1.07 Variance (%) 43.00 6.40 5.15 4.25 3.69 Internal consistency reliability (Cronbach's alpha) 0.90 0.89 0.87 0.88 0.66

1 (C1) 2 (C2) 3 (C3) 4 (C4) 5 (C5)

To examine the higher explanatory power of cultural dimensions for project performance, the statistical characteristics of all components are discussed. Table 3 shows the mean value (MCV) and standard deviation (SDCV) of the CV of the artifacts categorized in each component. The MCV and SDCV in each component are represented as C1 (low, high), C3 (medium, low), C2 (medium, high), C4 (medium, high), or C5 (high, low). With the introduction of the combination values of MCV and SDCV, the statistical characteristics of each component can be comprehensively discussed. Table 4 shows the frequency, mean, and standard deviation of the significance scores (SSs) and their ranks and the coefficient variation (CV) of each cultural artifact.

The first characteristic of C1 is its high explanatory power of the variance in PCFA, which is 43.0% (Table 4). C1 dominates in capturing the structural characteristics of the SSs of all artifacts much more effectively than the other components. Thus, C1 is the most "authoritative criterion" to judge whether each project belongs to the "majority" or "minority." The second characteristic of C1 is low MCV. Low MCV indicates a high mean and a low standard deviation of the SS. Thus, the artifacts in C1 were practiced most intensively and widely in the surveyed projects. Therefore, the characteristics of C1 are its dominant power to capture the structural characteristics of the entire data of the SSs and the most intensive and wide practice of its artifacts. The practical interpretation is that a project in which artifacts in C1 are not intensively practiced is considered a minority project (from the second characteristic) and actually a "true" minority project (from the first characteristic). These characteristics are expected to be the foundation of C1's high explanatory power for project performance.

The first characteristic of C3 is a lower explanatory power of the variance in PCFA than C1, which was 5.15% (Table 2). It should be noted that C3 thus does not form "major" statistical structural characteristics of the SSs of all artifacts, unlike C1. The second characteristic of C3 is medium MCV and low SDCV. Medium MCV indicates a medium mean and a medium standard deviation of the SS. Medium MCV implies that artifacts in C3 are generally practiced intensively and widely but not as intensively or widely as in C1. Low SDCV indicates that the CVs are not varied among the artifacts in the component. To determine the reason for this lack of variance, the correlation coefficients of the SSs among the three artifacts in C3, namely ACA1, ACA2, and ACA3, were examined. These correlation coefficients were 0.586, 0.727, and 0.771 in the ascending order. Accordingly, it is possible that all artifacts are practiced similarly. The third characteristic of C3 is its straightforward interpretation: contractor assurance. All artifacts concern contractor assurance. Therefore, the characteristics of


Table 3. Mean value and standard deviation of the CV of the artifacts categorized in each component.


ID

 Cultural artifacts

Frequency

significance

(SS)

1234

AH4 Instruction

AP3

AH5

AG5

AH2

Encouragement

making

AP6

attitudes to workers

AC7

 Assignment

 of blame and

accountability

AP5

AP7

 Emphasize

workers

Table 4.

Frequency,

 mean, and standard deviation of the significance

 scores (SSs) and their ranks and the coefficient variation (CV) of cultural artifacts.

 good conditions for

 Emphasize

 training works

Encouragement

 of respectful

 in decision

Commitment

 of project benefits

Participation

 in decision making

 Promote

empowerment

 by project leaders

 5 3.22

3.33

3.11

3.35

2.97

3.16

3.20

3.05

2.90

 1.04

 29

 28

 0.357

 1.03

 27

 27

 0.337

28

29

 C5

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 C5

 1.07

 24

 29

 0.335

27

 C2

 1.00

 25

 25

 0.316

26

 C5

 0.90

 28

 23

 0.303

 1.01

 21

 26

 0.301

 0.89

 26

 21

 0.287

 0.91

 22

 24

 0.274

 0.86

 23

 19

 0.269

21

22

23

24

25

 C4

 C2

 C2

 C4

 C2

 score

 of

Number of valid

Mean

SD of

Mean

SD

Coefficient

 of

CV

Component

rank

category

of SS

SS

rank

Rank

variation (CV)

samples


ID

 Cultural artifacts

Frequency

significance

(SS)

1234

AG2

 Obligation clarification

contractor

AG3

AP2

AG4

AH1

AH3 Direction by project leaders

AP1

 Value project

contributions

AG1

 Project objectives clarification

ACA5 Client's obligation to agreements

AC4

ACA1 Contractor

 assurance to project

quality

AC3

AC2

AC1

AP4

AC6

 Idea exchange and support

ACA3 Contractor

 assurance to project

budget

ASA4 ACA2 Contractor

 assurance to project

schedule

AC5

 Openness and mutual respect

Supervisor's

 obligation to work

 Recognize

 Effective interactions

 at work

achievements

 Information

 exchange

 Roles of project manager

Trust-sharing

 atmosphere

participants'

 Emphasize

 leadership

 Mutual

understanding

 Available

opportunities

 Obligation clarification

 by client

 by

4.01

4.08

3.74

3.79

3.74

3.59

3.85

3.70

3.62

3.52

3.62

3.65

3.66

3.59

3.51

3.55

3.48

3.52

3.48

3.47

 0.89

 20

 20

 0.257

20

 C2

 0.89

 19

 22

 0.257

 0.85

 15

 18

 0.242

18

19

 C3

 C1

 0.84

 18

 16

 0.240

 0.83

 14

 15

 0.235

 0.82

 17

 13

 0.235

 0.84

 12

 17

 0.233

 0.83

 8

 14

 0.227

 0.82

 9

 12

 0.225

12

13

14

15

16

17

 C3

 C2

 C2

 C2

 C1

 C1

 0.80

 10

 11

 0.221

 0.77

 16

 7

 0.220

 0.78

 11

 10

 0.217

 0.78

 7

 9

 0.210

8

9

10

11

 C3

 C1

 C2

 C1

 0.78

 3

 8

 0.201

 0.72

 13

 5

 0.201

 0.73

 5

 6

 0.194

 0.71

 4

 4

 0.189

 0.68

 6

 3

 0.181

 0.61

 1

 2

 0.149

2

3

4

5

6

7

 C1

 C4

 C1

 C1

 C1

 C1

 0.55

 2

 1

 0.136

1

 C1

 5

 score

 of

Number of valid

Mean

SD of

Mean

SD

Coefficient

 of

CV

Component

rank

category

72 Organizational Culture

of SS

SS

rank

Rank

variation (CV)

samples

Table 4. Frequency, mean, and standard deviation of the significance scores (SSs) and their ranks and the coefficient variation (CV) of cultural artifacts.

#### Project Organizational Culture Framework in Construction Industry http://dx.doi.org/10.5772/intechopen.78628 73

C3 are summarized as follows. C3 does not form major statistical structural characteristics, unlike C1. However, C3 is interpreted straightforwardly, and all artifacts are practiced intensively, widely, and similarly. The practical interpretation is that if one artifact is not intensively practiced in a project, the other two artifacts are also less likely to be intensively practiced. Thus, a project in C3 is clearly differentiated from other projects that have an intensive practice of artifacts. These characteristics appear to be the foundation of C3's high explanatory power for project performance.

A high explanatory power of C3 and C5 for project performance is worth noting because they have a much lower explanatory power of variance in PCA than C1. In the data structure of the SSs of all artifacts, the difference in the SSs of the artifacts in C3 and C5 was not as conspicuous as in C1. However, their improvement is expected to contribute to the enhancement of project performance. Furthermore, the mean values of the SSs in C3 and C5 were lower than in C1. This finding indicates that there is more room for improvement for C3 and C5 than for C1. This result is useful for project participants who would like to enhance their project as well as for policy makers who discuss and establish the future direction of the Vietnamese construction

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75

The project organizational culture dimensions were ranked by calculating the factor scores based on the average mean scores of each factor's artifacts. The mean score of these five factors indicated that the factors were above-average identifiers of project organizational culture in the construction industry, as shown in Figure 1. Moreover, problems have been reported in project performance in Vietnam with regard to poor quality, cost over runs, delays, and client dissatisfaction [54, 55]. This finding may infer a relevant connection between project organiza-

First, the cultural dimension of "project goal setting" (C1), which was ranked highest, can be connected with the cultural trait of mission in the model of Denison [56]. The specific indexes in this project cultural dimension clarify the goals and objectives, vision and strategy, which can provide project members with a clear direction for their work, answering the questions "where are they going" and how is their daily work" that contribute to the achieved project goals. This finding is also supported by the works of Cheung, Wong [51], who found that "goal setting and accomplishment" were significant among organizational culture dimensions in Hong Kong's construction industry. This finding clarifies the belief that a project organization is identified by its project participants' behavior, which in turn is formed by the project goals

industry.

tional culture and project performance.

Figure 1. Framework of project organizational culture.

The first characteristic of C5 is a lower explanatory power of variance in PCA than C1, which was 3.69% (Table 2). Thus, it should be noted that similar to C3, C5 does not form the "major" statistical structural characteristics of the SSs of all artifacts. The second characteristic of C5 is high MCV and low SDCV. High MCV indicates a low mean and a high standard deviation of the SSs. High MCV implies that the artifacts in C5 are generally practiced least intensively. In some projects, however, these artifacts are practiced intensively. Low SDCV indicates that the CVs are not varied among the artifacts in the component. To determine the reason for this lack of variance, the correlation coefficients of the SSs among the three artifacts in C5, namely AP5, AP6, and AP7, were assessed. These correlation coefficients were 0.687, 0.703, and 0.756 in the ascending order. Accordingly, it is possible that all artifacts are practiced similarly. The third characteristic of C5 is its straightforward interpretation: workforce emphasis. All artifacts implicate workforces. Therefore, the characteristics of C5 are summarized as follows. C5 does not form major statistical structural characteristics, similar to C3. However, C5 is interpreted straightforwardly. Although the artifacts are practiced least intensively, there are also some projects in which all the artifacts are practiced intensively. The practical interpretation is that if one artifact is intensively practiced in some project, the other two artifacts are also likely to be intensively practiced. Thus, a project in C5 is clearly differentiated from other projects that have a less intensive practice of artifacts. These characteristics seem to be a foundation of C5's high explanatory power for project performance.

Likewise, C2 and C4 have similar characteristics. The first characteristic is a lower explanatory power of variance in PCA, similar to C3 and C5, which was 6.40 and 4.25%, respectively (Table 2). The second characteristic is medium MCV and high SDCV. In particular, the values of SDCV in C2 and C4 were 0.0346 and 0.0371, respectively, which were more than twice as high as in C3 and C5. To determine the reason for this difference, the correlation coefficients of the SSs among the nine artifacts in C2, namely AG5, AC1, AC5, AC6, AC7, AP4, ACA5, AH4, and AH5, and the correlation coefficients of the SSs among the three components in C4, namely AP3, AH2, and AH3, were evaluated. Regarding C2, there were 36 correlation coefficients (=9\*8/2). The distribution of their values is as follows: 0.300–0.399: 8; 0.400–0.499: 17; 0.500–0.599: 10; and 0.700–0.709: 1. Regarding C4, the correlation coefficients were 0.370, 0.382, and 0.449 in the ascending order. These correlation coefficients were generally smaller than those in C3 and C5. The above analyses of C3 and C5 suggest that the necessary condition for C2 and C4, which have lower explanatory powers of variance in PCA, to have a high explanatory power for project performance is to have high correlation coefficients of the SSs among artifacts in each category. However, C2 and C4 do not satisfy this necessary condition. Even if some artifacts are practiced intensively in one project, other artifacts are not necessarily practiced intensively. Thus, it is difficult to clearly differentiate projects based on C2 and C4.

A high explanatory power of C3 and C5 for project performance is worth noting because they have a much lower explanatory power of variance in PCA than C1. In the data structure of the SSs of all artifacts, the difference in the SSs of the artifacts in C3 and C5 was not as conspicuous as in C1. However, their improvement is expected to contribute to the enhancement of project performance. Furthermore, the mean values of the SSs in C3 and C5 were lower than in C1. This finding indicates that there is more room for improvement for C3 and C5 than for C1. This result is useful for project participants who would like to enhance their project as well as for policy makers who discuss and establish the future direction of the Vietnamese construction industry.

The project organizational culture dimensions were ranked by calculating the factor scores based on the average mean scores of each factor's artifacts. The mean score of these five factors indicated that the factors were above-average identifiers of project organizational culture in the construction industry, as shown in Figure 1. Moreover, problems have been reported in project performance in Vietnam with regard to poor quality, cost over runs, delays, and client dissatisfaction [54, 55]. This finding may infer a relevant connection between project organizational culture and project performance.

First, the cultural dimension of "project goal setting" (C1), which was ranked highest, can be connected with the cultural trait of mission in the model of Denison [56]. The specific indexes in this project cultural dimension clarify the goals and objectives, vision and strategy, which can provide project members with a clear direction for their work, answering the questions "where are they going" and how is their daily work" that contribute to the achieved project goals. This finding is also supported by the works of Cheung, Wong [51], who found that "goal setting and accomplishment" were significant among organizational culture dimensions in Hong Kong's construction industry. This finding clarifies the belief that a project organization is identified by its project participants' behavior, which in turn is formed by the project goals

Figure 1. Framework of project organizational culture.

C3 are summarized as follows. C3 does not form major statistical structural characteristics, unlike C1. However, C3 is interpreted straightforwardly, and all artifacts are practiced intensively, widely, and similarly. The practical interpretation is that if one artifact is not intensively practiced in a project, the other two artifacts are also less likely to be intensively practiced. Thus, a project in C3 is clearly differentiated from other projects that have an intensive practice of artifacts. These characteristics appear to be the foundation of C3's high

The first characteristic of C5 is a lower explanatory power of variance in PCA than C1, which was 3.69% (Table 2). Thus, it should be noted that similar to C3, C5 does not form the "major" statistical structural characteristics of the SSs of all artifacts. The second characteristic of C5 is high MCV and low SDCV. High MCV indicates a low mean and a high standard deviation of the SSs. High MCV implies that the artifacts in C5 are generally practiced least intensively. In some projects, however, these artifacts are practiced intensively. Low SDCV indicates that the CVs are not varied among the artifacts in the component. To determine the reason for this lack of variance, the correlation coefficients of the SSs among the three artifacts in C5, namely AP5, AP6, and AP7, were assessed. These correlation coefficients were 0.687, 0.703, and 0.756 in the ascending order. Accordingly, it is possible that all artifacts are practiced similarly. The third characteristic of C5 is its straightforward interpretation: workforce emphasis. All artifacts implicate workforces. Therefore, the characteristics of C5 are summarized as follows. C5 does not form major statistical structural characteristics, similar to C3. However, C5 is interpreted straightforwardly. Although the artifacts are practiced least intensively, there are also some projects in which all the artifacts are practiced intensively. The practical interpretation is that if one artifact is intensively practiced in some project, the other two artifacts are also likely to be intensively practiced. Thus, a project in C5 is clearly differentiated from other projects that have a less intensive practice of artifacts. These characteristics seem to be a foundation of C5's

Likewise, C2 and C4 have similar characteristics. The first characteristic is a lower explanatory power of variance in PCA, similar to C3 and C5, which was 6.40 and 4.25%, respectively (Table 2). The second characteristic is medium MCV and high SDCV. In particular, the values of SDCV in C2 and C4 were 0.0346 and 0.0371, respectively, which were more than twice as high as in C3 and C5. To determine the reason for this difference, the correlation coefficients of the SSs among the nine artifacts in C2, namely AG5, AC1, AC5, AC6, AC7, AP4, ACA5, AH4, and AH5, and the correlation coefficients of the SSs among the three components in C4, namely AP3, AH2, and AH3, were evaluated. Regarding C2, there were 36 correlation coefficients (=9\*8/2). The distribution of their values is as follows: 0.300–0.399: 8; 0.400–0.499: 17; 0.500–0.599: 10; and 0.700–0.709: 1. Regarding C4, the correlation coefficients were 0.370, 0.382, and 0.449 in the ascending order. These correlation coefficients were generally smaller than those in C3 and C5. The above analyses of C3 and C5 suggest that the necessary condition for C2 and C4, which have lower explanatory powers of variance in PCA, to have a high explanatory power for project performance is to have high correlation coefficients of the SSs among artifacts in each category. However, C2 and C4 do not satisfy this necessary condition. Even if some artifacts are practiced intensively in one project, other artifacts are not necessarily practiced intensively. Thus, it is difficult to clearly differentiate projects based on C2 and C4.

explanatory power for project performance.

74 Organizational Culture

high explanatory power for project performance.

that are established and manifested by the activities implemented by the project members over the course of a project. In other words, clear project goals instruct the formulation of a project plan and viable execution. In addition, based on the results, the trust atmosphere is encouraged to be set. This finding may explain that with high uncertainty and conflicted benefits in construction contracts, the building of reliance rapports helps to promote agreement among project participants and reduces potential risk for all involved parties over the course of the project, contributing to the achieved project goals.

The project culture dimension of "cooperative orientation" (C2) refers to a coordination and integration culture with diverse participants and units of a project's organization, which helps project participants understand the mutual influences of their acts and ensures that all project members work together toward common goals. This result is to be expected. Due to the fragmented nature and temporary get-together of the construction industry, a highly cooperative orientation characterized by the free exchange of ideas and support, openness and respect, collaboration orientation, and the sharing of responsibility among construction project participants is an essential foundation for project success. By offering cooperation, project participants look forward to lessened project costs, shared project risks and rewards, and expanded mutual profits [57].

constant commitment to the development of employee skills and enhancement of work environment to remain competitive and improve competencies. However, the evaluation of this culture dimension obtained the lowest-ranked factor with a neutral score. This finding is compatible with previous research arguing that the construction industry maintains a lower priority on investment of the workforce as its greatest asset [59], and the construction industry also has one of the worst reported industry records with regard to health and safety and a poor record for recruitment and retention [60]. It can be inferred from this finding that the construction industry needs to pay more attention to training and development, health and safety conditions, decent site conditions, fair allowances and wages, and environment and sustain-

Contractor assurance (C3)

1.75 0.19 Empowerment assignment (C4)

http://dx.doi.org/10.5772/intechopen.78628

Project Organizational Culture Framework in Construction Industry

0.98 0.32 Workforce emphasis (C5) 77

0.29 0.59

Cooperative emphasis (C2)

1.27 0.26

Table 5. Analysis of variance (ANOVA) in regard to respondents' professions.

The analysis of variance (ANOVA) results of this study indicated that at a 99% confidence level (i.e., at the p < 0.01 level) (Table 5), there were no significantly different mean scores among groups of respondents for the five project organizational culture factors. This means that despite their association with different types of involved organizations, the two groups of project stakeholders (clients and contractors) shared similar views regarding project organizational culture in the construction industry. However, this finding differs from previous studies, which have argued that the contracting organizations in a construction project have different backgrounds, business objectives, leadership styles, life cycles, and work patterns. Thus, the different contracting organizations may develop different cultures [17, 61]. It can be inferred from this finding that both groups of respondents agree with the practices on representativeness of the identified project organizational culture factors instead of their conventional perceptions, which proves the highly relevant practice that contracting organizations can develop

In summary, the five factors identified by the PCFA in this chapter analyses are valid measures of project organizational culture, which reflects the practice-specific aspect of the construction

This chapter aimed to better define project organizational culture and to detect its framework based on the work practice approach, which was characterized by the practices experienced over the course of a project. In this respect, 29 artifacts of project organizational culture were first derived through FGSs, literature review, and face-to-face interviews with practitioners in the industry. Using Vietnam as a case study, measurements of the experiences of construction

ability, which are key to enhancing the industry's productivity.

common core values within a project.

industry.

Test method

Kruskal-Wallis test Statistics Project goal

0.49 0.48

Chisquared P-value

setting (C1)

5. Conclusions

The project culture dimension of "contractor assurance" (C3), which was a relatively highly ranked factor, aptly reflects the emphasis placed on contractor obligation to contract, which acts as a customer-focused characteristic toward adaptability culture [56]. These results are also in line with previous findings which suggest that the contractor significantly influences project performance [4]. This culture orientation reflects the fact that contractors are more concerned about the needs to react to and serve the client and constantly commit more capacity for satisfaction of the client's future needs and expectations. Moreover, what is intriguing is the fact that construction project performance in terms of poor quality, over budget, and time delays has been reported for years in developing countries, such as Vietnam [48]. It can be inferred from this finding that practitioners appear more concerned about the prioritization of contractors on site.

The project culture dimension of "empowerment assignment" (C4) provides project members who have the requisite authority, initiative, and capacity with opportunities to organize and oversee their responsibilities at work over the course of a project. These results are not surprising in the domain of project management. Under the natural complexity and uncertainty of construction project management, promoting empowerment cultures enhances the capacity to acquire feedback or suggestions from project members at various levels to management and the decision-making process, which is pivotal to reducing risks and improving project performance. In addition, offering this culture can create a sense of ownership and responsibility for all project members, promoting greater emotion in work toward the project organization goals. For organizations where employees are encouraged to speak up and be heard, this reflects that organizations are "using their greatest asset to its highest potential and, in return, are becoming more competitive in the emerging global economy" [58].

Finally, commitment to the cultural dimension of "workforce emphasis" (C5) generally indicates the culture of capability development [56] to which the project organization shares


Table 5. Analysis of variance (ANOVA) in regard to respondents' professions.

constant commitment to the development of employee skills and enhancement of work environment to remain competitive and improve competencies. However, the evaluation of this culture dimension obtained the lowest-ranked factor with a neutral score. This finding is compatible with previous research arguing that the construction industry maintains a lower priority on investment of the workforce as its greatest asset [59], and the construction industry also has one of the worst reported industry records with regard to health and safety and a poor record for recruitment and retention [60]. It can be inferred from this finding that the construction industry needs to pay more attention to training and development, health and safety conditions, decent site conditions, fair allowances and wages, and environment and sustainability, which are key to enhancing the industry's productivity.

The analysis of variance (ANOVA) results of this study indicated that at a 99% confidence level (i.e., at the p < 0.01 level) (Table 5), there were no significantly different mean scores among groups of respondents for the five project organizational culture factors. This means that despite their association with different types of involved organizations, the two groups of project stakeholders (clients and contractors) shared similar views regarding project organizational culture in the construction industry. However, this finding differs from previous studies, which have argued that the contracting organizations in a construction project have different backgrounds, business objectives, leadership styles, life cycles, and work patterns. Thus, the different contracting organizations may develop different cultures [17, 61]. It can be inferred from this finding that both groups of respondents agree with the practices on representativeness of the identified project organizational culture factors instead of their conventional perceptions, which proves the highly relevant practice that contracting organizations can develop common core values within a project.

In summary, the five factors identified by the PCFA in this chapter analyses are valid measures of project organizational culture, which reflects the practice-specific aspect of the construction industry.

### 5. Conclusions

that are established and manifested by the activities implemented by the project members over the course of a project. In other words, clear project goals instruct the formulation of a project plan and viable execution. In addition, based on the results, the trust atmosphere is encouraged to be set. This finding may explain that with high uncertainty and conflicted benefits in construction contracts, the building of reliance rapports helps to promote agreement among project participants and reduces potential risk for all involved parties over the course of the

The project culture dimension of "cooperative orientation" (C2) refers to a coordination and integration culture with diverse participants and units of a project's organization, which helps project participants understand the mutual influences of their acts and ensures that all project members work together toward common goals. This result is to be expected. Due to the fragmented nature and temporary get-together of the construction industry, a highly cooperative orientation characterized by the free exchange of ideas and support, openness and respect, collaboration orientation, and the sharing of responsibility among construction project participants is an essential foundation for project success. By offering cooperation, project participants look forward to lessened project costs, shared project risks and rewards, and expanded

The project culture dimension of "contractor assurance" (C3), which was a relatively highly ranked factor, aptly reflects the emphasis placed on contractor obligation to contract, which acts as a customer-focused characteristic toward adaptability culture [56]. These results are also in line with previous findings which suggest that the contractor significantly influences project performance [4]. This culture orientation reflects the fact that contractors are more concerned about the needs to react to and serve the client and constantly commit more capacity for satisfaction of the client's future needs and expectations. Moreover, what is intriguing is the fact that construction project performance in terms of poor quality, over budget, and time delays has been reported for years in developing countries, such as Vietnam [48]. It can be inferred from this finding that practitioners appear more concerned about the

The project culture dimension of "empowerment assignment" (C4) provides project members who have the requisite authority, initiative, and capacity with opportunities to organize and oversee their responsibilities at work over the course of a project. These results are not surprising in the domain of project management. Under the natural complexity and uncertainty of construction project management, promoting empowerment cultures enhances the capacity to acquire feedback or suggestions from project members at various levels to management and the decision-making process, which is pivotal to reducing risks and improving project performance. In addition, offering this culture can create a sense of ownership and responsibility for all project members, promoting greater emotion in work toward the project organization goals. For organizations where employees are encouraged to speak up and be heard, this reflects that organizations are "using their greatest asset to its highest potential and, in return, are becom-

Finally, commitment to the cultural dimension of "workforce emphasis" (C5) generally indicates the culture of capability development [56] to which the project organization shares

project, contributing to the achieved project goals.

mutual profits [57].

76 Organizational Culture

prioritization of contractors on site.

ing more competitive in the emerging global economy" [58].

This chapter aimed to better define project organizational culture and to detect its framework based on the work practice approach, which was characterized by the practices experienced over the course of a project. In this respect, 29 artifacts of project organizational culture were first derived through FGSs, literature review, and face-to-face interviews with practitioners in the industry. Using Vietnam as a case study, measurements of the experiences of construction practitioners were then used in PCA to classify these artifacts into five factors of project organizational culture.

Conflict of interest

Author details

Luong Hai Nguyen1

References

There is no conflict of interest.

\* and Tsunemi Watanabe<sup>2</sup>

1 University of Transport and Communications, Dong Da Dist., Hanoi, Vietnam

2 School of Economics and Management, Kochi University of Technology, Kochi, Japan

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79

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[9] Cheung SO, Wong PSP, Lam AL. An investigation of the relationship between organizational culture and the performance of construction organizations. Journal of Business

Journal of Construction Engineering and Management. 1996;122(2):119-124

Journal of Construction Engineering and Management. 1999;125(3):142-150

\*Address all correspondence to: hainl@utc.edu.vn

Perspective. New York: Taylor & Francis; 2008

and Economics. 1997;15(6):513-518

and Economics. 2003;21(7):777-785

of Project Management. 2014;32(4):544-555

Economics and Management. 2012;13(4):688-704

The most highly ranked project organizational culture factors of "project goal setting" emphasize the importance of clarification of project goals and objectives in which all project members are clearly provided direction and scope for their work over the course of a project. In addition, the relatively highly ranked project organizational culture factor of "contractor assurance" reflects the culture of customer focus, within which contractors are noted as the pivotal element to assure project performance. The project organizational culture factor of "cooperative emphasis" highlights the fragmentation characteristics and diverse individuals involved in a construction project. This makes perfect sense in construction project management, as having a cooperative atmosphere ensures that all project members mutually understand and work well together toward common goals. The factors of "empowerment assignment" and "workforce emphasis" reflect people-focused cultures, within which the human resource is viewed as the greatest asset. It thus implies that project management should invest more in humanity, to which project members are associated with a greater sense of ownership and responsibility, leading to a greater commitment to the project organization and an increased capacity for autonomy in the achievement of project goals.

The analyses identified no significant differences in the assessment of the culture factors provided by project stakeholders. The acceptance of these factors with moderate mean scores by the two groups of construction professionals suggests that core common values in projects can be generated by devoting efforts to derive project goals and objectives instead of individual benefits among contracting organizations. The policy implication is that project stakeholders should focus more efforts on promoting managerial practices that are deemed most cultural in the construction industry, potentially contributing to the practice of effective change in project management.

### 6. Research limitations and future research

This study suffers from limitations. First, the data collected were national character may yield some cautions of the generalizability of the research findings. In addition, there were broad cultural artifacts and sophisticated definition of cultural terms that may also appear non-friendly to practitioners in the industry. Future studies should consider a larger volume of data that can focus on conducting a comparative assessment using data from separate project stakeholders. This will provide a clearer understanding of how different stakeholders view common practices of project delivery.

### Acknowledgements

The authors acknowledge the participation of the individuals and organizations who kindly contributed their time, professional experience and knowledge to this study.

### Conflict of interest

practitioners were then used in PCA to classify these artifacts into five factors of project

The most highly ranked project organizational culture factors of "project goal setting" emphasize the importance of clarification of project goals and objectives in which all project members are clearly provided direction and scope for their work over the course of a project. In addition, the relatively highly ranked project organizational culture factor of "contractor assurance" reflects the culture of customer focus, within which contractors are noted as the pivotal element to assure project performance. The project organizational culture factor of "cooperative emphasis" highlights the fragmentation characteristics and diverse individuals involved in a construction project. This makes perfect sense in construction project management, as having a cooperative atmosphere ensures that all project members mutually understand and work well together toward common goals. The factors of "empowerment assignment" and "workforce emphasis" reflect people-focused cultures, within which the human resource is viewed as the greatest asset. It thus implies that project management should invest more in humanity, to which project members are associated with a greater sense of ownership and responsibility, leading to a greater commitment to the project organization and an increased

The analyses identified no significant differences in the assessment of the culture factors provided by project stakeholders. The acceptance of these factors with moderate mean scores by the two groups of construction professionals suggests that core common values in projects can be generated by devoting efforts to derive project goals and objectives instead of individual benefits among contracting organizations. The policy implication is that project stakeholders should focus more efforts on promoting managerial practices that are deemed most cultural in the construction industry, potentially contributing to the practice of effective change

This study suffers from limitations. First, the data collected were national character may yield some cautions of the generalizability of the research findings. In addition, there were broad cultural artifacts and sophisticated definition of cultural terms that may also appear non-friendly to practitioners in the industry. Future studies should consider a larger volume of data that can focus on conducting a comparative assessment using data from separate project stakeholders. This will provide a clearer understanding of how different stakeholders view common practices

The authors acknowledge the participation of the individuals and organizations who kindly

contributed their time, professional experience and knowledge to this study.

capacity for autonomy in the achievement of project goals.

6. Research limitations and future research

organizational culture.

78 Organizational Culture

in project management.

of project delivery.

Acknowledgements

There is no conflict of interest.

### Author details

Luong Hai Nguyen1 \* and Tsunemi Watanabe<sup>2</sup>

\*Address all correspondence to: hainl@utc.edu.vn


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**Chapter 5**

**Provisional chapter**

**Organizational Culture as a Determinant of**

**Organizational Culture as a Determinant of** 

Additional information is available at the end of the chapter

Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.77165

**of Croatia**

**of Croatia**

Ivana Šandrk Nukić

Ivana Šandrk Nukić

**Abstract**

Croatia

**1. Introduction**

**Construction Companies' Competitiveness: Case Study**

**Construction Companies' Competitiveness: Case Study** 

The aim of this chapter is to assess the organizational culture in construction industry in Croatia. The introductory part of the chapter highlights the purpose of the study presented in terms of learning the characteristics of the current and preferred organizational culture of the Croatian construction industry as well as understanding the relationship between the culture and competitiveness. Being a transitional country, Croatia is facing the need for behavior change of companies seeking competitive advantage, especially after becoming a part of the united European market. In a labor-intensive business like construction, adaptation of companies strongly depends on the underlying values and assumptions of their employees. Therefore, change management implies a need to learn about culture profiles. Results of the conducted research reveal culture profiles within construction industry in Croatia in respect of the size, core business, regional orientation and ownership of the analyzed companies. The preferences of existing engineers together with expectations of Generation Y have been also considered in order to anticipate the trends and necessary changes of organizational culture in construction industry in Croatia. Finally, findings of the cross-country analysis of culture's implications on competitiveness will be presented, proving that culture's role

should be considered by decision makers trying to improve competitiveness.

**Keywords:** organizational culture, competitiveness, construction industry, trend,

Human behavior is significantly determined by organizational culture. As one of the biggest authorities in the field says, organizational culture is a reflection of the basic assumptions

> © 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

© 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use,

distribution, and reproduction in any medium, provided the original work is properly cited.

DOI: 10.5772/intechopen.77165

#### **Organizational Culture as a Determinant of Construction Companies' Competitiveness: Case Study of Croatia Organizational Culture as a Determinant of Construction Companies' Competitiveness: Case Study of Croatia**

DOI: 10.5772/intechopen.77165

Ivana Šandrk Nukić Ivana Šandrk Nukić

Additional information is available at the end of the chapter Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.77165

#### **Abstract**

The aim of this chapter is to assess the organizational culture in construction industry in Croatia. The introductory part of the chapter highlights the purpose of the study presented in terms of learning the characteristics of the current and preferred organizational culture of the Croatian construction industry as well as understanding the relationship between the culture and competitiveness. Being a transitional country, Croatia is facing the need for behavior change of companies seeking competitive advantage, especially after becoming a part of the united European market. In a labor-intensive business like construction, adaptation of companies strongly depends on the underlying values and assumptions of their employees. Therefore, change management implies a need to learn about culture profiles. Results of the conducted research reveal culture profiles within construction industry in Croatia in respect of the size, core business, regional orientation and ownership of the analyzed companies. The preferences of existing engineers together with expectations of Generation Y have been also considered in order to anticipate the trends and necessary changes of organizational culture in construction industry in Croatia. Finally, findings of the cross-country analysis of culture's implications on competitiveness will be presented, proving that culture's role should be considered by decision makers trying to improve competitiveness.

**Keywords:** organizational culture, competitiveness, construction industry, trend, Croatia

### **1. Introduction**

Human behavior is significantly determined by organizational culture. As one of the biggest authorities in the field says, organizational culture is a reflection of the basic assumptions

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. © 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

shared by members of a group, which defines the group's view of itself and its environment as well as its way of performing daily activities [1]. It should be emphasized that in terms of organizational culture, group can stand for a nation, an industry segment, a company or any other relatively stable social construct. However, there are authors pointing to differences between organizational culture and national culture. Although there is a consensus that culture is always about sharing collective values and behavior by members of the group, national cultures differ mainly on the level of fundamental values, while organizational cultures alter more on the level of perfunctory practices and can be more manageable. As such, organizational culture is determined by the national culture [2–4].

part of the International Council for Research and Innovation in Building and Construction, said that the capability of handling the culture-issue within construction processes was a kind of risk-management tool because it reduced the risk of behavioral miscommunication [11].

Organizational Culture as a Determinant of Construction Companies' Competitiveness: Case…

http://dx.doi.org/10.5772/intechopen.77165

87

Construction industry is indeed a group with a specific culture. It is mostly the result of a distinct business environment: geographically distributed nature of construction, dynamic nature of site management, highly mobile and itinerant work force, the large number of different companies and organizations that have to work together in a project (designers, contractors, supervisors, etc.) and a fixed duration of construction project [12]. Finally, construction industry has been exposed to intense business globalization recently, and in the international context, the need for understanding and appreciating the culture has become

After describing applied methodology, this chapter provides insight into characteristics of the organizational culture present in Croatian construction industry, followed by the findings of the expected culture change in the future, respecting the preferences of current and future engineers. The remainder of the chapter presents results of the cross-country analysis of competitiveness and culture correlation, while final conclusions are intended to make key lessons

The research presented in this chapter was in fact an extensive case study, conducted in several phases over the last 3 years. It was designed in a way to reflect all relevant aspects of the subject and purpose of this study. As a result, different scientific methods were applied.

The first phase was intended for the secondary data analysis. During that phase, scientific methods of analysis and synthesis of the relevant literature were used, followed by descriptive method and classifications of identified key issues, as well as compilation method with the aim of setting the more specific goals for the empirical part of the research. Findings from this research phase were used mostly in the introductory part of this chapter as well as for the

After secondary data analysis had pointed out the aspects whose research would give an additional value to the study through building the extant knowledge, the first empirical phase of the study was conducted. It was the analysis of organizational culture of the Croatian construction industry. There is a variety of measure instruments used to assess the organizational culture, out of which the Competing Values Framework and Organizational Culture Assessment Instrument (OCAI) have been adopted as methods for this study, because OCAI was verified as reliable in

As a measurement tool, OCAI is based on the Competing Values Framework, which was developed during the 1980s [17, 18] for assessing and profiling the dominant cultures of organizations. As shown in **Figure 1**, this framework is consisted of two dimensions: the first dimension measures organizational focus from internal to external and the second dimension differentiates a focus on flexibility, discretion and dynamism from focus on stability, order and control.

even more important [13–15].

from the overall research more visible.

interpretation of the later empirical results.

**2. Research methodology and applied methods**

measuring organizational culture in construction sector [16].

At present, there is a growing interest in studying the relationship between the organizational culture and the company performance resulting from its competitiveness [5]. It seems that with the world economic globalization aggravating, organizational culture as a soft power has become a weapon used to seize the opportunity to meet the challenges and achieve sustainable competitiveness [6].

As in culture, the competitiveness is also being analyzed at different levels. Evaluated from the company level competitiveness, over sectoral to national and global competitiveness [7, 8], those levels in fact correlate with the abovementioned levels of culture. Since competitiveness is considered a key determinant for growth and new jobs creation, it is a concept that has been intensively discussed. World Economic Forum assesses the competitiveness of 140 economies in its Global Competitiveness Report [9], providing insight into the drivers of their productivity and prosperity. Those drivers are organized in 12 relatively independent pillars, but since all those pillars are very people-driven, it can be easily assumed that they are closely related to national and organizational culture.

In the light of the abovementioned facts, the purpose of this study is to learn the relationship between the culture and competitiveness as well as the competitiveness implications of the current and preferred culture profile characteristic of the Croatian construction industry.

In order to fulfill so defined purpose, several research objectives have been set:


There are several reasons making these goals worth studying. First of all, previous research [10] indicates that there is a significant correlation between a construction company's organizational culture and the company performance, but at the same time it implies the knowledge gap and the need for further analysis in order to present that correlation in more detail.

Furthermore, being a labor-intensive business, construction industry is especially sensitive to basic assumptions shared by project team members or any other critical group. That is why Wilco Tijhuis, joint-coordinator at working-commission W112 "Culture in Construction," part of the International Council for Research and Innovation in Building and Construction, said that the capability of handling the culture-issue within construction processes was a kind of risk-management tool because it reduced the risk of behavioral miscommunication [11].

Construction industry is indeed a group with a specific culture. It is mostly the result of a distinct business environment: geographically distributed nature of construction, dynamic nature of site management, highly mobile and itinerant work force, the large number of different companies and organizations that have to work together in a project (designers, contractors, supervisors, etc.) and a fixed duration of construction project [12]. Finally, construction industry has been exposed to intense business globalization recently, and in the international context, the need for understanding and appreciating the culture has become even more important [13–15].

After describing applied methodology, this chapter provides insight into characteristics of the organizational culture present in Croatian construction industry, followed by the findings of the expected culture change in the future, respecting the preferences of current and future engineers. The remainder of the chapter presents results of the cross-country analysis of competitiveness and culture correlation, while final conclusions are intended to make key lessons from the overall research more visible.
